titan final lr
DESCRIPTION
annualTRANSCRIPT
NOTICE
Notice is hereby given that the Twenty-eighth Annual General Meeting (“the Meeting”) of TITAN INDUSTRIES LIMITED (“the Company”) will
be held at the Registered Office of the Company, at 3, SIPCOT Industrial Complex, Hosur 635 126, on Tuesday, 31st July 2012 at 3:00 P.M. to
transact the following business:
ORDINARY BUSINESS1) To receive, consider and adopt the Balance Sheet as at 31st March 2012, the Profit and Loss account for the year ended on that date and
the Reports of the Directors’ and the Auditors’ thereon.
2) To declare dividend on equity shares for the financial year ended 31st March 2012.
3) To appoint a Director in place of Mrs. Hema Ravichandar who retires by rotation and is eligible for re-appointment.
4) To appoint a Director in place of Mr. R. Poornalingam who retires by rotation and is eligible for re-appointment.
5) To appoint a Director in place of Mr. N.N.Tata who retires by rotation and is eligible for re-appointment.
6) To consider and, if thought fit, to pass with or without modification, the following resolution as a Special Resolution:
“RESOLVED that M/s. Deloitte Haskins & Sells, Chartered Accountants (Registration No. 008072S), be and hereby are re-appointed as
Auditors of the Company, to hold office from the conclusion of this Annual General Meeting till the conclusion of the next Annual
General Meeting, to audit the Accounts of the Company for the financial year 2012-13, including audit of Cash Flow Statements, on a
remuneration to be mutually decided upon between the Auditors and the Board of Directors of the Company.”
SPECIAL BUSINESS7) To consider and if thought fit to pass with or without modification, the following resolution as an Ordinary Resolution:
“RESOLVED that Mr. K. Dhanavel, IAS who was appointed as a Director by the Board of Directors with effect from 30th April 2012 and
who holds office up to the date of this Annual General Meeting under section 262 of the Companies Act, 1956 read with Article 118 of
the Articles of Association of the Company and in respect of whom the Company has received a notice in writing under section 257 of
the Companies Act, 1956 from a shareholder proposing his candidature for the office of Director of the Company, be and is hereby
appointed as a Director of the Company.”
8) To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution:
“RESOLVED that pursuant to sections 269, 309, 311 and other applicable provisions, if any, of the Companies Act, 1956, approval is hereby
accorded to the reappointment of Mr. Bhaskar Bhat as Managing Director of the Company for a period of five years from 1st April 2012
to 31st March 2017, upon the principal terms and conditions set out in the explanatory statement attached hereto and the Agreement
submitted to this meeting and initialled by the Chairman of the meeting for identification, which Agreement is hereby specifically
approved and sanctioned with liberty to the Board of Directors to increase, alter and vary, without further reference to the Shareholders,
the terms and conditions of the said reappointment and/or Agreement in the event of change in legislation, rules and regulations in
this regard, in such a manner as may be acceptable to Mr. Bhaskar Bhat.
RESOLVED FURTHER that the Board be and is hereby authorised to take all such steps as may be necessary, proper and expedient to give
effect to this Resolution.”
Notes: a) The relative explanatory statement pursuant to Section 173 of the Companies Act, 1956, in respect of business under item nos. 6, 7 & 8
above is annexed hereto. The relative details as required by Clause 49 of the Listing Agreements entered into with the Stock Exchanges,
of persons seeking appointment / re-appointment as Directors under item nos. 3, 4, 5 & 7 of the Notice, are also enclosed.
b) A Member entitled to attend and vote at the Annual General Meeting (the “Meeting”) is entitled to appoint a proxy to attend andvote in the meeting and the proxy need not be a member of the Company. Proxies in order to be effective must be received by the
Company at its Registered Office not less than 48 hours before the Meeting. A Proxy is not entitled to vote except on a poll. Proxies
submitted on behalf of limited companies, societies etc., must be supported by appropriate resolutions / authority, as applicable.
Titan Industries Limited
c) The Register of Members and the Transfer Books of the Company will be closed from Tuesday, 17th July 2012 up to Tuesday, 31st July
2012, both days inclusive.
d) Subject to the provisions of Section 206A of the Companies Act, 1956 dividend on equity shares as recommended by the Directors, if
declared at the Meeting, will be paid commencing from August 6, 2012 to those members whose names appear on the Register of
Members of the Company as on 16th July 2012. In respect of shares held in electronic form, dividend will be paid to the beneficial
holders as per the beneficiary list to be provided by the National Securities Depository Limited and Central Depository Services (India)
Limited as at the close of business hours on 16th July 2012.
e) Members are requested to inform the Company’s Registrars and Share Transfer Agents viz., TSR Darashaw Ltd (formerly Tata Share Registry
Ltd), regarding changes, if any, in their registered addresses with the PIN code number.
f ) Members holding shares in physical form are requested to consider converting their holding to dematerialised form to eliminate all risks
associated with physical shares and for ease in portfolio management. Members can contact the Company or TSR Darashaw Ltd, for
assistance in this regard.
g) As per the provisions of Section 109A of the Companies Act, 1956, the facility for making nominations is available to the shareholders
in respect of the equity shares held by them. A specimen nomination form (Form 2B) is attached to this Annual Report for use by the
shareholders.
h) The equity shares of the Company are listed at the following Stock Exchanges in India:
Bombay Stock Exchange Ltd, National Stock Exchange of India Ltd,
25, Phiroze Jeejeebhoy Towers, Exchange Plaza,
Dalal Street, Bandra Kurla Complex, Bandra (East)
Mumbai 400 001 Mumbai 400 051
The Company has paid the annual listing fees to each of the above Stock Exchanges for the financial year 2012-13.
i) Members are requested to intimate to the Company, queries if any, regarding the accounts at least 10 days before the Annual General
Meeting to enable the Management to keep the information ready at the Meeting. The queries may be addressed to: Head – Legal &
Company Secretary, Titan Industries Limited, Golden Enclave, Tower-B, 7th Floor, HAL Airport Road, Bangalore 560 017. (email :
[email protected]) Members are requested to bring their copies of Annual Reports to the Meeting.
j) For the convenience of Members, the Company will provide a coach service from Bangalore on the day of the Meeting. The coaches
will leave for Hosur at 1 p.m. from the following four locations:
1) Jayanagar - Ashok Pillar, 1st Block, Siddapura Police Station Road, Bangalore - 560 011
2) Rajajinagar - near ISKCON temple , Opp. Varasidhi Vinayakar Temple, Government
School Grounds, Bangalore - 560 010
3) Golden Palm Station, near BRV theatre, Bangalore - 560 001
4) Leela Palace Hotel, HAL Airport Road, Bangalore - 560 017
k) Shareholders are requested to furnish their e-mail id particulars to the Company at the Company’s dedicated mail id: [email protected].
This will assist the Company in redressing of shareholders’ grievances expeditiously.
l) The Ministry of Corporate Affairs (vide circular nos. 17/2011 and 18/2011 dated April 21, 2011 and April 29, 2011 respectively) has
undertaken a `Green Initiative in Corporate Governance’ and allowed companies to share documents with its shareholders through an
electronic mode. A recent amendment to the Listing Agreement with the Stock Exchanges permits companies to send soft copies of
the Annual Report to all those shareholders who have registered their email address for the said purpose. Members are requested to
support this Green Initiative by registering / updating their e-mail addresses for receiving electronic communications.
Registered Office: By Order of the Board of Directors,
3, SIPCOT Industrial Complex
Hosur 635 126 A.R. Rajaram25th June 2012 Head – Legal & Company Secretary
As required by section 173 of the Companies Act, 1956, the following explanatory statement sets out all material facts relating to the business
mentioned under item Nos. 6, 7 & 8 of the accompanying Notice dated 25th June 2012.
Item No. 6:Since the shareholding pattern of the Company is such that the provisions of section 224A of the Companies Act, 1956, are applicable, the
appointment of Auditors of the Company is required to be made by a special resolution. It has been proposed to re-appoint M/s. Deloitte
Haskins & Sells as Auditors of the Company for the financial year 2012-13.
The Shareholders are requested to approve the re-appointment of Deloitte Haskins & Sells as the Statutory Auditors by a special resolution,
to audit the accounts of the Company for FY 2012-13 as set out in Item No. 6 of the Notice.
None of the Directors of the Company has any concern or interest in this item of business.
Item No. 7:Mr. K. Dhanavel, IAS, was appointed as a Director on the Board of the Company by the Board of Directors in the casual vacancy caused by
the resignation of Mrs. Susan Mathew with effect from 30th April 2012. In terms of section 262 of the Companies Act, 1956, Mr. K. Dhanavel
holds office as a Director till the date of the ensuing Annual General Meeting of the Company, but is eligible for appointment. Notice in
writing has been received from a Shareholder of the Company signifying their intention in proposing Mr. K. Dhanavel as a candidate for the
office of Director.
Mr. K. Dhanavel, IAS is the Managing Director of Tamilnadu Industrial Development Corporation Ltd, the co-promoter of the Company.
The Board considers it desirable that the Company continues to avail of the services and wise counsel of Mr. K. Dhanavel and accordingly
the Directors recommend that he be appointed as a Director of the Company.
Other than Mr. K. Dhanavel none of the other Directors, is in any way, concerned or interested in this resolution.
Item No. 8:Mr. Bhaskar Bhat’s tenure as Managing Director expired on 31st March 2012. At the Board Meeting of the Company held on 31st January 2012,
the Board had approved the re-appointment of Mr. Bhaskar Bhat as Managing Director for a further period of five years from April 1, 2012 to
March 31, 2017 on terms and conditions as set out below based on the recommendations of the Remuneration Committee and subject to
approval by the Shareholders at the Annual General Meeting of the Company.
(a) Salary Salary up to a maximum of Rs. 10,00,000 per month, with authority to the Board to fix the salary within the said maximum amount from time
to time. The annual increments shall be effective 1st April each year, and shall be decided by the Board and will be merit based and take
into account the Company’s performance.
(b) Perquisites(1) In Addition to the salary, Mr. Bhaskar Bhat shall be entitled to perquisites such as:
i. Furnished accommodation, with expenditure on gas, electricity, water and maintenance and repairs thereof or, House Rent Allowance
and house maintenance allowance with expenditure on gas, electricity, water and furnishings
ii. Leave Travel Allowance for self and family
iii. Medical expenses and Medical Insurance for self and family
iv. Personal Accident Insurance
v. Club Fee
and other such perquisites and allowances in accordance with the rules of the Company and as may be agreed by the Board of Directors
and Mr. Bhaskar Bhat; and such perquisites and allowances will be subject to overall ceiling as may be fixed by the Board of Directors
from time to time.
(2) Company maintained car with driver for official and personal use
ANNEXURE TO NOTICE
Titan Industries Limited
(3) Telecommunication facilities at residence
(4) Contribution to Provident Fund, Superannuation Fund and Annuity Fund and Gratuity as per the rules of the Company.
(5) Leave and encashment of unavailed leave as per the rules of the Company.
(c) Commission Such remuneration by way of Commission, in addition to salary and perquisites, calculated with reference to the net profits of the
Company in a particular financial year, as may be determined by the Board of Directors of the Company at the end of the each financial
year, subject to the overall ceiling stipulated in sections 198 and 309 of the Companies Act, 1956 (“The Act”). The exact amount payable
will be decided by the Board of Directors based on certain performance criteria and shall be payable only after the Annual Accounts of
the Company have been approved by the Board of Directors and adopted by the Shareholders.
(d) Minimum RemunerationNot-withstanding anything to the contrary contained herein, where in any financial year, during the currency of the tenure of Mr. Bhaskar
Bhat, the Company has no profits or its profits are inadequate, the Company will pay salary and perquisites and allowances as specified
above to Mr. Bhaskar Bhat as minimum remuneration.
The aggregate of the remuneration as aforesaid shall be within the maximum limits as laid down under sections 198, 309, 310 and all other
applicable provisions, if any, of the Act, read with Schedule XIII of the Act as amended and as in force from time to time.
In due compliance with the provisions of the sections 309 & 310 read with Schedule XIII with the Act, the re-appointment of Mr. Bhaskar Bhat
as Managing Director for a further period of 5 years from 1st April 2012 to 31st March 2017 is being placed for approval by the Shareholders
at the Annual General Meeting of the Company.
The draft Agreement between the Company and Mr. Bhaskar Bhat is available for inspection by the Members of the Company at its Registered
Office between 11.00 a.m. and 1.00 p.m. on any working day of the Company.
The abstract of the draft Agreement between the Company and the Managing Director pursuant to sec 302 of the Companies Act, 1956 has
already been mailed to the Shareholders of the Company.
Mr. Bhaskar Bhat may be deemed to be concerned or interested in this resolution as it relates to his re-appointment and variation of the terms
of his appointment as mentioned above.
A copy of the Memorandum and Articles of Association of the Company is available for inspection of Members on any working day between
11 a.m. and 1 p.m. at the Registered Office of the Company from the date of this notice up to the date of the Annual General Meeting.
Registered Office: By Order of the Board of Directors,
3, SIPCOT Industrial Complex
Hosur 635 126 A.R. Rajaram25th June 2012 Head – Legal & Company Secretary
Name of the Director Mrs. Hema Ravichandar Mr. R. Poornalingam Mr. N N Tata Mr. K. Dhanavel
Date of Birth 14.05.1961 15.11.1945 12.11.1956 09.06.1954
Date of appointment 30.03.2009 30.03.2009 07.08.2003 30.04.2012
Expertise in specific Rich experience in Rich experience in various Wide knowledge and Rich experience in various
functional areas Human Resource Senior Administrative experience in sales and Senior Administrative
Development and is a positions in State and marketing, expertise in positions in State and
leading HR consultant. Central Government retail business Central Government
Qualifications B.A (Economics); IAS(Retd) B.A (Economics) from B.Sc, M.A, B.L, M.B.A, IAS
Post Graduate Diploma M.A. (Economics) University of
in Management, B.E. (Honours) Sussex, IEP, INSEAD, France
IIM Ahmedabad B.L.
Shareholdings Nil Nil 46,900 shares Nil
List of Public Companies Marico Ltd Loyal Textile Mills Ltd Trent Ltd Tamilnadu Industrial
in which outside National Textile Voltas Ltd Development
Directorships held Corporation Ltd Landmark Ltd Corporation Ltd
on 31st March, 2012 Trent Brands Ltd Ennore SEZ Company Ltd
Tata Investment Tanflora Infrastructure Park Ltd
Corporation Ltd TRIL Infopark Ltd
Trent Hypermarket Ltd Tamil Nadu Road
Kansai Nerolac Paints Ltd Development Co Ltd
Tata International Ltd IT Expressway Ltd
Drive India Enterprose Tamilnadu Petroproducts Ltd
Solutions Ltd L & T Shipbuilding Ltd
TICEL Bio Park Ltd
TIDEL Park (Coimbatore) Ltd
TIDEL Park Ltd
Chairman/Member of Audit Committee Audit Committee Audit Committee
the Committee of Board Marico Ltd - Member Trent Ltd - Member TICEL Bio Park Ltd - Chairman
of Public Companies Corporate Governance Shareholders' Grievance TIDEL Park Coimbatore
on which he/she is a Committee Committee Ltd - Chairman
Director as on Marico Ltd - Chairman Voltas Ltd - Chairman State Industries
31st March, 2012 Remuneration Committee Promotion Corporation
Tata Investment of Tamilnadu Ltd - Member
Corporation Ltd - Member Tamilnadu Industrial
Audit Committee Development
Trent Hypermarket Ltd - Member Corporation Ltd - Member
Remuneration Committee
Trent Hypermarket Ltd - Member
Details of Directors seeking appointment / re- appointment in forthcoming Annual General Meeting(In pursuance of Clause 49 of the Listing Agreement)
(Directorship & Committee Membership other than Titan Industries Ltd)
Reference FolioNo. of Shares held.
No. of Equity Shares Held
Members Folio No.
I/We------------------------------------------------------------------------------------------------------------------------------------- of---------------------------------------------------------------in
the district of-----------------------------------------------------being a member/members of the above named Company, hereby appoint-------------------------------------
----------------------------------------of-----------------------------------------------------------in the district of ---------------------------or failing him --------------------------------------
---------------------------------------------of------------------------------in the district of ---------------------------------------------------------------as my/our Proxy to attend and vote
for me/us and on my/our behalf at the Twenty Eighth Annual General Meeting of the Company, to be held at 3:00 p.m. on Tuesday, 31st July 2012 and at any
adjournment thereof.
Signed this-----------------------------------------day of-----------------------------------------2012
This form is to be used---------------------------------------------the resolution. Unless otherwise instructed the proxy will act as he thinks fit.
*strike out whichever is not desired.
Note: This Proxy must be returned so as to reach the Registered Office of the Company, 3, SIPCOT Industrial Complex, Hosur 635 126, not less than FORTYEIGHT HOURS before the Meeting
*in favour of*against
Note: 1. Shareholder/proxy holder wishing to attend the Meeting must bring this Attendance Slip to the Meeting and hand it over at the entrance duly signed.
2. Shareholder/Proxyholder desiring to attend the Meeting should bring his copy of the Annual Report for reference at the Meeting.
DP ID No.*
Client Id*
Name of the attending Member .......................................................................................................................................................................................................................................................................................I hereby record my presence at the TWENTY EIGHTH ANNUAL GENERAL MEETING of the Company at 3, SIPCOT Industrial Complex, Hosur 635 126 at 3:00 p.m.on Tuesday, 31st July 2012.
SIGNATURE OF THE ATTENDING MEMBER/PROXY
To be handed over at the entrance of the Meeting Hall.
Affix 30 paise Revenue
Stamp
(Signature of the Member)
TITAN INDUSTRIES LIMITED Regd. Office: 3, SIPCOT INDUSTRIAL COMPLEX, HOSUR 635 126
TITAN INDUSTRIES LIMITED Regd. Office: 3, SIPCOT INDUSTRIAL COMPLEX, HOSUR 635 126
PROXY FORM
ATTENDANCE SLIP
DP ID/Ben ID
Client Id*
1. Hassle-free direct credit of Dividend – Make use of NECS facility for speedy credit of DividendShares held in Electronic Form� Register your latest Bank Account details (Core Banking Solutions enabled account number, 9 digit MICR and 11 digit IFS code) with your Depository
Participant.
Shares held in Physical Form� Provide your latest Bank Account details (Core Banking Solutions enabled account number, 9 digit MICR and 11 digit IFS code) along with your folio
number to our Registrars and Transfer Agents, TSR Darashaw Ltd, 6-10, Haji Moosa Patrawala Industrial Estate, 20. Dr. E. Moses Road, Mahalakshmi,Mumbai 400 011.
� In case you do not provide your new account number details as mentioned above, electronic credit of Dividend to your account is liable to be rejected.
2. Dematerialise your Physical Shares to Electronic Form� Eliminate all risks associated with Physical Shares.
� Ease in Portfolio Management
Procedure for Dematerialisation of Shares� Open Beneficiary Account with a Depository Participant (DP) registered with SEBI.
� Submit Dematerialisation Request Form (DRF) as given by the DP, duly signed by all the holders with the names and signatures in the same order asappearing in the concerned certificate(s).
I / We, ______________________________________ the holder (s) of Shares / Debentures bearing Folio / Receipt Number ______________________ and
accruals thereon of Titan Industries Limited wish to make a nomination and do hereby nominate the following person in whom all rights of transfer and / or
amount payable in respect of shares / debentures shall vest in the event of my/ our death.
Name and address of the Nominee
Name : __________________________________________________________________________________________________
Address : __________________________________________________________________________________________________
________________________________________________________________ Pin code: __________________________
Date of Birth* : ___________________________________________________
(to be furnished in case the nominee is minor) ________________________________
Signatue of Nominee
(Optional)
* The nominee is a minor whose Guardian is :
Name and Address of Guardian _____________________________________________________________________________________
______________________________________________________________________________________________________________
______________________________________________________________________________________________________________
Signature(s) of Holder(s)
Signature : ______________________________ Signature : _________________________________
(1st Holder) (1st joint holder, if any)
Name : _____________________________ Name : _________________________________
Address : _____________________________ Address : _________________________________
_____________________________ _________________________________
Date : _____________________________ Date : _________________________________
Signature of Two Witnesses
Name and address Signature with Date
1.
2.
Instructions :1. The Nomination can be made by individuals only applying/holding shares/ debentures on their own behalf singly or jointly up to two persons. Non-
individuals including society, trust, body corporate, partnership firm, Karta of Hindu Undivided Family, holder of Power of Attorney cannot nominate.
2. A minor can be nominated by holders of shares/debentures and in that event the name and address of the Guardian shall be given by the holders.
3. The nominee shall not be a Trust, Society, Body Corporate, Partnership Firm, Karta of Hindu Undivided Family or a Power of Attorney holder. A Non-resident
Indian can be a nominee on repatriable basis provided RBI approval granted to the nominee is registered with the Company.
4. Nomination shall stand rescinded upon transfer of shares/debentures.
5. Transfer of shares/debentures in favour of a nominee shall be valid discharge by a Company against the Legal heir.
FOR OFFICE USE ONLY
Nomination Regn No : ________________________________ Checked by : ______________________________________
Date of Registration : _______________________________ Signature of Employee : _____________________________________
FORM 2B(See rules 4 CCC and 5D)
NOMINATION FORM(To be filled in by individual applying singly or jointly)
GUIDELINES FOR NOMINATION1. Nomination per Folio -
Nomination for only one folio can be made on this Form, In case you have many folios then you make take a photocopy of this Form
and nominee separately.
2. Signatures -
The sole/joint holders should sign as per the specimen signature recorded with the Company, else the Form is liable to be rejected.
3. Registration of Nomination -
Upon receipt of a duly executed Nomination Form, TSR Darashaw Ltd will register the nomination and allot a Registration number. This
number will be furnished to the holder. All the subsequent correspondence regarding the nomination may please be done quoting the
Registration number.
4. Change of Nomination -
The holder(s) can override (delete or change) an earlier nomination by executing a fresh Nomination Form for which a fresh Registration
number will be allotted. The earlier nomination will automatically stand cancelled.
5. Change in composition of the Account -
Nomination stands rescinded upon transfer of shares / debentures. Whenever the shares/ debentures in the given folio are
transferred/transposed/transmitted/dematerialized/ amalgamated with some other folio, then this nomination stands void. A new
Nomination Form will have to be filled by the person(s) in whose name(s) the shares/debentures have been
transferred/transposed/transmitted/amalgamated.
6. Electronic Holding-
The nomination given in the Form would be considered for the physical holding only. In case securities are held in electronic form, then
the holder(s) have to approach the Depository Participant for registering their nomination.
7. Accruals and Acquisitions-
Once a nomination is registered by a Company for a given folio, the same is valid for all future accruals and acquisitions made by the
holder(s) in that folio unless notified to the contrary by the holder(s). The accruals could be in the form of Rights, Bonus, Purchases from
open market under the same folio etc.
8. Validity of Nomination-
The nomination made through Form 2B will be considered valid and recognized by the Company if the nomination made by the holder(s)
of the shares/debentures is registered with the Company before the death of the holder(s) of the shares/debentures/deposits.
9. Entitlement of Nominee-
The nominee will be entitled to all the rights in the shares / debentures of the Company only in the event of the death of the Sole / all
holders in the account. The nominee will be required to approach the Company for transmitting the securities in his/ her name and will
be required to produce the death certificate of the holder(s), the share/debentures and proof of identity as required by the Board of
Directors of the Company. The Registration number under which the nomination was registered should also be provided to the Company.
10. Date of Execution-
Kindly note that nomination being a legal document should be dated by the nominator and the witness certifying that the Form has been
signed by the nominator in their presence. Furthermore the date of execution on the Nomination Form should match with the date of
witnesses, witnessing the document.
“Titan – the changing face of time”The six words that define Titan’s journey over thepast 25 years and extension beyond time
TWENTY-EIGHTHANNUAL REPORT 2011-123, SIPCOT Industrial Complex,
Hosur 635 126
The Goldplus Nano car adorned with 5000 years of Indian jewellery-making tradition,travelled across 30 cities promoting Goldplus, the mass market jewellery brand
Titan. From a precisionengineering manufacturer-innovative marketer and brandbuilder to all that and India’slargest specialty retailer.When most people questioned whether
the country even needed another watch
brand, Titan invested in a world-class
integrated watch manufacturing facility at
Hosur and entered into a movement
manufacturing collaboration with France
Ebauches.
Over the past 25 years, Titan is respected
for three distinctive competencies: an
insight into the precision engineering of
components, a reputation for the creation
of iconic brands from scratch and respect
as the country’s leading specialty retailer.
Starting with watches and then moving
on to jewellery and later into eyewear and
accessories, Titan has redefined the rules
of business in every category it has
entered, with the consumer as its prime
stakeholder. In the process, it has built
endearing brands like Titan, Sonata,
Fastrack, Xylys, Nebula and Zoop in
watches and accessories, Tanishq,
GoldPlus and Zoya in jewellery and Titan
Eye+ in eyewear.
Early in its business, Titan recognised that
it needed to complement the
manufacture of world-class watches with a
sophisticated buying experience. This led
to the creation of the ‘World of Titan’ chain
– the first Titan watches chain of
showrooms. Gradually, the role of retail at
Titan shifted from product display to
convenient access and superior customer
experience that eventually transformed
the watches market. The World of Titan
network now comprises a formidable 332
stores across 133 towns. Our watches
division is reinforced by a 728-strong
service network located across 270 towns.
Gradually, Titan’s core strengths in design,
manufacturing, marketing and retail were
leveraged to extend into other spaces. The
result was that the Tanishq retail store
chain was launched to market jewellery in
1995. Over time, Tanishq has emerged as
India’s largest and most trusted Jeweller.
Tanishq, GoldPlus and Zoya constitute
India’s finest jewellery chains and cover a
combined spread of 163 outlets and 4.6
lakh sq. ft.
In 2007, the Company extended the same
competencies and specialty retail
expertise to the ‘Titan Eye+’ optical chain,
offering superior quality and stylish
products coupled with a world-class
shopping experience. More recently, the
Company also created ‘Helios’, a multi-
Promoted in the mid-Eightiesby the Tata Group and TamilNadu Industrial DevelopmentCorporation Limited (TIDCO),Titan Industries is a uniqueinstance of how ideas can betaken from scratch andtransformed into winningbrands that generate value,create entire market spacesand then consistentlydominate these spaces.
TWENTYEIGHTH ANNUAL REPORT 201112
brand retail chain of premium watches,
and ‘Fastrack’ stores for watches and
accessories for youth.
The result is that Titan Industries is now
India’s largest specialty retailer comprising
seven retail chains with more than 827
retail outlets across 157 Indian towns with
a combined area of over 1 million sq. ft. It
is a matter of great pride that Titan was
ranked first in Retail Industry in India’s Best
Companies to work for 2011 award by The
Economic Times.
Titan’s success is inherently derived from
an ability to think different. Titan is driven
by the passion and dedication of its 6,102-
strong employees (as on 31 March 2012)
and is deeply grateful to their focus, hard
work and commitment to take Titan to
where it is today. As a proud development,
Titan was ranked 15th in India’s Best
Companies to work for 2011 award by The
Economic Times.
The last 25 years have witnessed Titan
emerging as a leader in most segments
that it operates in and scale phenomenal
heights thanks to the support of its
shareholders and Board of Directors for
their deep level of engagement, guidance
to the management and commitment to
strong governance practices. Titan has
attained an unmatched position today and
looks forward to the next 25 years with the
confidence to scale greater heights.
Titan has attained anunmatched position todayand looks forward to the next25 years with the confidenceto scale greater heights.
� A fully-automated line for a valve part in theautomotive space
� Assembles 17 complex parts
� Delivers tested products automatically in sixsecond cycle-time
1
BOARD OF DIRECTORSN Sundaradevan (Chairman)
Susan Mathew (up to 24.10.2011)
K Dhanavel (from 30.04.2012)
V Parthasarathy
Bhaskar Bhat (Managing Director)
Ishaat Hussain
N N Tata
T K Balaji
C G Krishnadas Nair
Vinita Bali
Hema Ravichandar
R Poornalingam
Das Narayandas
HEAD – LEGAL & COMPANY SECRETARY
A R Rajaram
AUDITORS
Deloitte Haskins & Sells
BANKERS
Canara Bank
Bank of Baroda
The Hongkong and Shanghai Banking Corporation Ltd
Standard Chartered Bank
Oriental Bank of Commerce
Union Bank of India
Indian Bank
REGISTERED OFFICE
3, SIPCOT Industrial Complex, Hosur 635 126
OVERSEAS BRANCH OFFICE
Hongkong: Unit No. 11 & 12, 20/F, Metro Loft No.38, Kwai Hei Street,
Kwai Chung N T, Hongkong Tel : 00852 64716536
SHARE DEPARTMENT
TSR Darashaw Ltd
Unit : Titan Industries Ltd,
6-10, Haji Moosa Patrawla Industrial Estate,
20, Dr. E Moses Road, Mahalaxmi,
Mumbai 400 011
CONTENTSDirectors’ Report ...................................................................... 02
Management Discussion and Analysis ...................... 10
Corporate Governance Report ....................................... 20
Auditors’ Report ....................................................................... 39
Balance Sheet ............................................................................ 42
Statement of Profit and Loss ............................................ 43
Cash Flow Statement ........................................................... 44
Notes forming part of
the Financial Statements ................................................... 46
Interest in Subsidiaries ......................................................... 69
Consolidated Accounts ....................................................... 71
Shareholders’ Information.................................................... 99
Financial Statistics ................................................................... 103
Titan Industries is a TATA Enterprise in association with Tamilnadu Industrial Development Corporation
Visit us at www.titan.co.in
Annual General MeetingTuesday, 31st July 2012 at 3:00 p.m. at
3, SIPCOT Industrial Complex, Hosur 635 126
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28th Annual Report 2011-12
2
To the Membersof TITAN INDUSTRIES LIMITED
The Directors are pleased to present the Twenty-eighth Annual Report and the Audited Statement of Accounts for the year ended 31st March
2012:
Financial Results (Rs. in crores)
2011-2012 2010-2011
Sales Income 8970.86 6570.86
Other Income 94.11 56.08
Total Income 9064.97 6626.94
Less: Excise Duty 132.48 49.97
Net Income 8932.49 6576.97
Expenditure 8005.43 5908.97
Gross profit 927.06 668.00
Finance Costs 43.72 34.52
Cash operating profit 883.34 633.48
Depreciation / Amortisation 44.90 34.48
Profit before taxes 838.44 599.00
Income taxes Current 238.90 168.60
Deferred (5.29) (3.24)
Profit after taxes for the year 604.83 433.64
Less: Income tax of earlier years 4.67 3.22
Net Profit 600.16 430.42
Even as the Indian economy encountered a challenging 2011-12,
the Company recorded its best-ever performance.
In 2011-12, the Company’s sales income grew by 36.5% to
Rs. 8,970.86 crores compared with Rs. 6,570.86 crores in the previous
year. Creditably, the percentage growth of our bottom lines was
higher: profit before tax grew by 40% to Rs. 838.44 crores, while net
profit grew by 39.4% to Rs. 600.16 crores.
Even though the Indian economy grew slower in 2011-12, Titan
Industries Limited reported a stronger growth on account of a deep
understanding of consumer preferences, product differentiation,
new product launches and professional brand management.
Directors’ ReportSales of the Watches Division (net of excise duty) grew by 20.3% to
Rs.1,529.76 crores, the business achieving breakthroughs in a
number of new segments – the sub-Rs 500 economy segment
where the Sonata Super-Fibre model reported handsome offtake;
the children’s segment, where Titan Zoop blazed to a sale of half-a-
million watches in its very first year of full operations; the expansion
of the exclusive Fastrack store network reinforced the brand’s
excitement across the preferred youth segment; the successful
Fastrack products extended into accessories (bags, belts, wallets,
wrist-bands). Besides, Helios, the 25-store chain that retails more
than 35 international premium and luxury watch brands in addition
to the Company’s Titan and Xylys brands, performed creditably.
The Company’s Jewellery Division sales (net of excise duty) grew by
39.8% to Rs.7,064.16 crores owing to increased sales of diamond-
studded jewellery and the grammage growth of gold jewellery
despite higher gold prices. The Division launched the Mia and Fq
jewellery lines with an eye on working women and the younger
generation respectively.
The Company’s Eyewear Division, Accessories and Precision
Engineering revenues (net of excise duty) cumulatively strengthened
by 34.8% to Rs.328.81 crores. The Company’s Eyewear business
capitalized on retail expansion while the Company’s B2B business of
Precision Engineering turned around, the challenging environment
notwithstanding.
This growth was partly catalyzed by a widening of the retail network
through the net addition of 162 stores (2,26,491 sq.ft.) across the
Watches, Jewellery and Eyewear Business Divisions. The Company
controls a network of 827 stores (including franchisee stores) with
over 10,36,000 sq. ft of retail space as on 31st March 2012, which
delivered a retail turnover of over Rs. 8,500 crores in 2011-12.
Simultaneously, the Company strengthened its business through
fresh investments. It has invested in the commercial production of an
integrated state-of-the-art Jewellery unit in the excise-free zone of
Pantnagar, Uttarakand. The Rs 15 crore unit was commissioned in
March 2012 to manufacture studded jewellery, with a peak
employment opportunity of 250 and a projected turnover of Rs. 250
crores in 2012-13.
International operationsEven though the Company was largely focused on the Indian
market, it continued to strengthen its international exposure as well.
The Company achieved exports of Rs.160 crores during the year
under review comprising watches and precision engineered
components; this was a 26.5% improvement over the previous year.
The International Watches division, which moved into Vietnam in
2009 and South Africa in 2010-11, reported encouraging results in
2011-12.
While Far East Asian markets continued to do well, some Middle East
markets reported sluggishness. The export of precision engineered
components reported an improvement in 2011-12 due to a high
quality standard, which translated into Precision Engineering
Component and Sub-Assemblies (PECSA) orders from the aerospace,
oil and gas and electrical sectors while traction for the Machine
Building and Automation (MBA) business translated into attractive
export orders.
DividendThe Directors are pleased to recommend the payment of dividend
on equity shares at the rate of 175% (Rs.1.75 per equity share),
subject to approval by the shareholders at the Annual General
Meeting.
FinanceThe Indian economy reported slower growth in 2011-12 on account
of inflation, rising interest rates, rupee depreciation and commodity
volatility. In this uncertain environment, the Company repaid
borrowings of Rs.58.07 crores and strengthened its business through
a capital expenditure of Rs.136.68 crores in plant refurbishment,
expansion programmes, retail outlets and IT hardware systems.
As on 31st March 2012, there were no fixed deposits held by the
Company from the public, shareholders and employees other than
unclaimed deposits amounting to Rs.0.05 crore.
An amount of Rs.216.31 crores was transferred to the general reserve.
During the year under review, the Company made payments
aggregating Rs.992.57 crores by way of taxes (central, state and local)
and duties as against Rs. 675.23 crores in the previous year.
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28th Annual Report 2011-12
4
Bonus issue and sub-division of equity shares Pursuant to Section 192A of the Companies Act, 1956, read with the
Companies (passing of Resolutions by Postal Ballot) Rules, 2001,
approval of the shareholders was obtained by postal ballot for the
alteration of the Memorandum of Association of the Company for
increase in Authorized Equity Share Capital from Rs. 120 crores to Rs.
160 crores, alteration of the Articles of Association of the Company
for increase in Authorized Equity Share Capital, issue of bonus shares
in the ratio of one equity share for every one equity share held,
alteration of capital clause in the Memorandum of Association of the
Company for sub-division of equity shares of a face value of Rs.10
each into 10 equity shares of Re.1 each and alteration of the Articles
of Association of the Company to reflect the sub-division of the
equity share capital of the Company.
The shareholders of the Company approved the issue of bonus
equity shares in the ratio of one equity share for every one equity
share held on 24th June 2011, the Record Date and for sub-division
of the equity share of Rs. 10 each into 10 equity shares of Re. 1 each,
and accordingly allotment of the split cum bonus shares were made
to the shareholders of the Company.
Consequently, the paid-up equity share capital of the Company
increased to Rs. 88,77,86,160 comprising 88,77,86,160 equity shares
of Re. 1 each.
Subsidiaries As on 31st March 2012, the Company had the following subsidiaries:
1) Titan TimeProducts Ltd, Goa
2) Titan Properties Ltd, Hosur
3) Favre Leuba AG, Switzerland
In 2011-12, Titan TimeProducts Ltd. sold 8.99 million (2010-11: 8.52
million) electronic circuit boards with a net profit of Rs.102.94 lakhs
(2010-11: Rs 72.62 lakhs). Titan Properties Ltd made a net profit of
Rs.65.01 lakhs (2010-11: Rs.170.32 lakhs). Favre Leuba AG, Switzerland
was incorporated on January 13, 2012 as a limited liability Company
owning the trademarks, Favre Leuba. None of these companies
declared a dividend in 2011-12.
The annual accounts of these subsidiary companies were
consolidated with the accounts of Titan Industries Ltd for 2011-12.
The High Court of Karnataka sanctioned the Scheme of
Amalgamation filed by Tanishq (India) Ltd, the Company’s wholly-
owned domestic subsidiary, with the Company from the appointed
date of April 1, 2010. Accordingly, the accounts of Tanishq (India) Ltd.
were merged with the accounts of Titan Industries Ltd.
A petition was filed pursuant to Sections 391 to 394 of the
Companies Act, 1956 by the Company’s subsidiary company, Titan
Properties Limited as the Transferor Company, seeking sanction to
the Scheme of Amalgamation proposed to be made between itself
and its holding Company Titan Industries Ltd as the Transferee
Company effective from 1st April 2011 as the appointed date. No
shares of the Transferee Company are to be issued pursuant to the
Scheme.
The Ministry of Corporate Affairs, Government of India has issued a
Circular No. 2 /2011 dated 8th February 2011 granting general
exemption to Companies under Sec 212(8) from attaching the
documents referred to in Sec 212 (1) pertaining to its subsidiaries,
subject to approval by the Board of Directors of the Company and
furnishing of certain financial information in the Annual Report.
The Board of Directors of the Company have accordingly decided to
dispense with the requirement of attaching to its Annual Report the
annual audited accounts of the Company’s subsidiaries.
Accordingly, the Annual Report of the Company does not contain
the individual financial statements of these subsidiaries, but contains
the audited consolidated financial statements of the Company, its
subsidiaries and an associate. The Annual Accounts of these
subsidiary companies, along with the related information, is available
for inspection at the Company's registered office and copies shall be
provided on request. The statement pursuant to the approval under
section 212(8) of the Companies Act, 1956, is annexed together with
the Annual Accounts of the Company. The same will also be available
on our web-site www.titan.co.in
Consolidated financial statements The Consolidated Financial Statements of the Company prepared as
per Accounting Standard AS 21 and Accounting Standard AS 23,
consolidating the Company’s accounts with its subsidiaries and an
associate have also been included as part of this Annual Report.
Corporate Social Responsibility Titan’s corporate social responsibility charter prioritized support to
the underprivileged in the areas of education, physical disability,
employability, skill building and girl child welfare. The Company
sustained programmes in these areas in 2011-12 while focusing on
two projects - The Girl Child Education program (Titan Kanya) and
Project Clean Hosur. Titan Kanya expects to provide education for
the girl child, benefiting about 12,000 girl children.
The Company worked with KC Mahindra Education Trust, supporting
2000 girl children in Mumbai, Delhi, Chennai and Hyderabad
through the Nanhi Kali program. The Company agreed to support
30 Learning Centers of NGO IIMpact in Dehradun and Roorkee -
areas with the poorest female literacy rates in India - that can
potentially benefit around 1000 girl children.
The Company also embarked on a citizen-based program to
enhance Hosur’s cleanliness, inspired by a volunteer-based initiative
in Estonia and a similar program in Kulithalai (Tamil Nadu). Over 400
Hosur volunteers, drawn from various walks of life, participated in a
pilot project in December 2011. The Sustainable Integrated Solid
Waste Management Project for Hosur is expected to go live in July
2012 across Hosur (72 acres, 2.75 lakh population).
Awards and recognitionThe Company’s initiatives and performance were recognized across
various platforms. The Jewellery Division won the coveted JRD-QV
Award, securing 602 marks (won by Time Products Division in 2006).
Brand Tanishq won numerous awards during the year under review
including three awards at Big Bang Advertising Awards for Excellence
in Communication and Best campaign, four awards at CMO Asia
award for excellence in Branding and Marketing, IRF award for the
Most Admired Retail Brand for the luxury segment, two Star Retailer
Awards for retail campaign and retail design, ET Retail Award for
Innovative Operating Idea of the Year and the Images Fashion Most
Admired Jewellery Brand of the Year. Brand Goldplus won the Gem
Visions’ Designs Appreciation Award.
The Integrated Supply Chain of the Jewellery Division won a number
of awards, including the IMTMA Productivity Championship Award,
two Qimpro awards for Innovations, Gold Award in ET manufacturing
excellence awards in partnership with Frost & Sullivan and Award for
Benchmarking and the Golden Peacock Innovation Award.
The ‘Titan’ watch brand won the Northeast Consumer Award for
most preferred watch brand. The Fastrack brand won the Gold
Award in IAMAI Digital Media awards for its interactive video SMS.
Titan HTSE mobile application was one amongst the top 5 brands of
the world to be nominated for the prestigious Mashables Award,
won the Gold at IDM awards, Gold for the “Best use of Emerging
Media” at the International Festival for Media apart from many
accolades at the Abby Awards in Goafest for the TV Commercial.
The Company was ranked first in the Retail Category for the third
year in succession, first in workplace diversity and inclusion and 15th
overall in a survey, ‘India’s best companies to work for’ by Great place
to Work Institute India.
The Company received the Retailer of the Year award at the Star
Retailer and Franchise Awards, Most Admired Fashion Company of
the Year at the Images Fashion Awards, ET award for Excellence in
Employee Practices and continued to top the Karmayog CSR rating
for the fourth consecutive year.
The Company’s Managing Director, Mr. Bhaskar Bhat was recognized
as the Indian Retail Forum’s Most Admired Retail Professional of The
Year and The ET Retail Personality of the Year.
Particulars of EmployeesIn terms of provisions of section 217(2A) of the Companies Act, 1956,
read with the Companies (Particulars of Employees) Rules, 1975, the
names and other particulars are set out in the Annexure to the
Directors’ Report. However, having regard to the provisions of section
219 (1) (b) (iv) of the Companies Act, 1956, the Annual Report
excluding the aforesaid information is being sent to all the members
of the Company, and others entitled thereto. Any member interested
in obtaining such particulars may write to the Company Secretary
at the Registered Office of the Company or through mail by sending
their requests to the Company Secretary.
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28th Annual Report 2011-12
6
Conservation of Energy, TechnologyAbsorption, Foreign Exchange Earnings andOutgoA statement giving details of conservation of energy, technology
absorption, foreign exchange earnings and outgo in accordance
with Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 is annexed to this report.
Corporate governanceA separate report on Corporate Governance forms a part of the
Annual Report along with the Auditors’ Certificate on Compliance.
Directors’ Responsibility StatementPursuant to section 217(2AA) of the Companies Act, 1956, the
Directors’ based on the representations received from the operating
management confirm that:
1. In the preparation of the annual accounts, the applicable
accounting standards have been followed and that there are no
material departures;
2. They have in the selection of the accounting policies, consulted
the statutory auditors and have applied them consistently and
made judgments and estimates that are reasonable and prudent
so as to give a true and fair view of the state of affairs of the
company at the end of the financial year and of the profit of the
company for that period;
3. They have taken proper and sufficient care, to the best of their
knowledge and ability, for the maintenance of adequate
accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
4. They have prepared the annual accounts on a going concern
basis.
AuditorsMembers will be requested at the Annual General Meeting to
appoint auditors for the current year and pass resolutions per Item
No. 6 of the Notice.
Directors Mrs. Hema Ravichandar, Mr. R.Poornalingam and Mr. N.N. Tata retire
by rotation and are eligible for re-appointment.
Mr. K. Dhanavel, IAS, Managing Director of Tamilnadu Industrial
Development Corporation Ltd (TIDCO) was appointed as a Director
on the Board of the Company on 30th April 2012, as a nominee of
TIDCO.
Members attention is drawn to Item No.7 of the Notice for the
appointment of Mr. K. Dhanavel as a Director of the Company.
AcknowledgementsYour Directors wish to place on record their appreciation of the
support which the Company has received from its promoters,
lenders, business associates including distributors, vendors and
customers, the press and the employees of the Company.
On behalf of the Board of Directors,
N. Sundaradevan
Bangalore, 25 June 2012 Chairman
CONSERVATION OF ENERGY AND FUELThe Company’s lens lab at Chikballapur undertook a number of
measures to conserve energy through the use of energy-efficient
electronic ballasts and CFLs, providing automatic water filling and
level control systems, installing automatic changeover systems for
electrical panels leading to the efficient use of generator sets and
oral communication to enhance awareness. The Company plans to
introduce initiatives comprising the replacement of CFL with LED
lights, which will reduce repairs, electrical equipment and
production costs by 2 to 4%.
Various energy conservation initiatives by the Jewellery Division
comprised a thermal energy storage system (TES) with screw chiller,
LED street lighting as well as energy-efficient equipment and
technology, leading to a net energy saving of Rs.17 lakhs in 2011-12.
Several key automation processes were introduced to de-skill
operations, reduce process time, improve productivity and
strengthen material safety and handling, among others. The
Company adopted various technologies like resin technology, robot
duct cleaning, sticky mat, electro polishing and automatic refining to
reduce gold loss.
The Company implemented energy conservation projects with
Honeywell Automation Limited, which resulted in a power and fuel
cost saving of Rs. 70 lakhs during 2011 -12 in line with the
performance guarantee provided by the vendor.
Green powerIn line with a ‘carbon neutral’ vision, your Company sourced a part of
its energy needs at the watch manufacturing facility through
renewable wind energy. During 2011-12, 2.4 million energy units
were sourced from private wind farms, which resulted in cost savings
of Rs. 8 lakhs and reduced 1,820 tonnes in carbon emissions during
2011-12.
Wind power plant – joint ventureDuring 2011-12, the wind power plant generated 43.5 lakh units of
energy (targeted 47.0 lakh units). The total generated energy was
consumed at the watch (80%) and jewellery (20%) manufacturing units
in Hosur. During 2011-12, this project delivered net cost savings of Rs.
89.7 lakhs and rationalized carbon emissions by 3,130 tonnes. The
sourcing of wind power from private and captive wind farms helped
reduce carbon emission to an extent of 4,950 tonnes in 2011-12.
Harnessing solar energySolar cooking: The Company invested in a Rs 90 lakh ‘solar cooking
system’ in the canteens of its watch and jewellery manufacturing
divisions in Hosur. This investment will help reduce the diesel
consumption of 30 KL per annum and reduce 88 tonnes per annum
of carbon emissions. This project became operational at the watch
division from January 2012.
Solar lighting: The Company installed a unique Rs 80 lakh ‘light pipe’
project to harvest sunlight and address its general lighting
requirements on the manufacturing shop floors of its watch plant.
Around 20,000 sq.ft of shop floor area was covered by solar lighting
in 2011-12, which will help reduce carbon emissions by 17 tonnes
per annum.
LED lighting: The Company invested in LED lighting projects in line
with the energy conservation potential of 60% at the Hosur watch
manufacturing unit. Based on the results of a pilot project at the
administration block, the project was extended to the other shop floors.
Your Company intends to invest more than Rs. 50 lakhs in this project.
Annexure to the Directors’ Report(Particulars pursuant to Companies (Disclosure of particulars in the report of the Board ofDirectors) Rules, 1988)
9
28th Annual Report 2011-12
8
TECHNOLOGY ABSORPTION, ADAPTATION ANDINNOVATION The lens lab at Chikballapur procured high-speed cutting
technology comprising the latest CNC controllers in the surfacing
department. A fast UV curing process in hard coating proved to be
energy-efficient over the conventional thermal curing process; the
AR coating machine was fitted with a state-of-the-art turbo
molecular pump to achieve the required vacuum effect faster than
conventional vacuum pumps.
The watch assembly unit in Pantnagar (excise duty-free zone)
ramped production from 1.5 million to 3.0 million during the
financial year under review. The Company re-engineered the existing
metal movement of Cal.7000 series to a hybrid version in
collaboration with Seiko Epson, Japan. The movement division
increased the production of Cal.7000 hybrid movements to 1.1
million in 2011-12 compared with 0.4 million in 2010-11.
Adhesive application was automated in the case assembly. A 3-axis
cartesian robot and support software was developed by the case
automation and technology cell. Three robots were commissioned,
which will be progressively scaled. These robots enhanced
productivity, helped spread adhesive on cases uniformly and
enhanced the water resistance of the cases.
A hybrid option of hot and cold forming was piloted in Case Press
operations. This technique (warm forming) was deployed to produce
bulky asymmetrical cases. A new 240T servo screw press was
commissioned in the case press shop to scale this technology.
Following an increase in the requirement of stainless steel cases, the
Company has invested in foreign technical know-how. As a result,
17 cases with higher UCP range were converted from brass to
stainless steel.
The Automation business (PED) developed unique assembly
technology for the following applications:
� Canola assembly line on rotary index platform incorporating
needle feeding with precision orientation mechanism, UV
gluing, camera-based vision inspection and leak testing system.
� Capacitor assembly line on linear index platform, deploying
automatic wound element feeder, wire feeding /bending
mechanism, resistance welding and flame soldering technology.
� Miniature circuit breaker assembly line on modular system
combining rotary index machine and linear transfer system. The
process technology comprises precision riveting with heat
stacking technique, laser marking, electrical testing and camera
vision inspection on 15 parameters.
OCCUPATIONAL HEALTH AND SAFETYMANAGEMENT SYSTEM (OHSMS) The Company is engaged in the implementation of Occupational
Health & Safety Management System (OHSMS) in line with the
OHSAS 18001 international standard. This system will comprise the
various manufacturing units (watches, jewellery, lens lab, precision
engineering) and retail segments (company-owned stores of
Tanishq, World of Titan and Titan Eye Plus).
The OHSMS implementation will implement and improve the
Occupational Health & Safety Management system to eliminate or
minimize risks to personnel and interested parties exposed to
occupational health and safety hazards.
The Company’s OHS Management System Practices reinforced its
commitment to cleanliness, quality, integrity and human values. The
Company implemented systems to identify occupational health and
safety hazards, assessing risks through suitable controls with the
objective of continuous improvement.
The OHS Management System was integrated with the
organizational structure and audited (internal and external) the OHS
practices. The company engaged Underwriters Laboratories
Management System Solutions Private Limited (Bangalore) to
conduct a third party audit and certify its OHSMS system.
FOREIGN EXCHANGE EARNINGS AND OUTGODuring the year under review, the Company earned Rs. 160.83 crores in foreign exchange and spent Rs. 4,006.78 crores (including Rs.3,733.05
crores in the procurement of gold and Rs.22.64 crores in capital imports).
EXPENDITURE ON RESEARCH AND DEVELOPMENT (Rs. in lakhs)
Year ended 31.3.2012 Year ended 31.3.2011
(a) Capital 5.79 29.59
(b) Revenue 330.26 301.69
(c) Total 336.05 331.28
(d) Total R & D expenditure as percentage of turnover 0.04% 0.05%
On behalf of the Board of Directors,
N. Sundaradevan
Bangalore, 25 June 2012 Chairman
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28th Annual Report 2011-12
10
THE ECONOMYThe Indian economy is estimated to have grown 6.5% in 2011-12 as
against 8.4% in 2010-11.
The lower GDP growth was primarily on account of a combination
of global economic headwinds, a challenged Indian industrial sector,
inflation, periodic interest rate hikes, infrastructural slowdown and a
sharp depreciation of the Indian Rupee against the US Dollar starting
from the third quarter of 2011-12.
The silver lining in India was the performance of the services sector:
The segment grew 9.4% and its share in India’s GDP climbed from
58% in 2010-11 to 59% in 2011-12. The country’s agriculture and
allied sectors grew 2.5% in 2011-12. National consumption grew 6%
and private consumption grew 6.5% compared with 8.1% in the
previous year.
The slowdown was largely a result of the global economic upheaval
following the Euro-zone turmoil from September 2011, which raised
questions about the economic stability of a number of countries.
Consequently, there were sharp rating downgrades of sovereign
debt across a number of advanced countries. This adverse reality
notwithstanding, India retained its position as one of the world’s
fastest growing economies.
BUSINESS OVERVIEW Despite cost-push pressures and rising interest rates that prompted
a number of consumers to postpone their purchases, the Company
performed credibly: Income increased 37% from Rs. 6,571 cr in 2010-
11 to Rs. 8,971 cr in 2011-12 while profit after tax strengthened 39%
from Rs. 430 cr in 2010-11 to Rs. 600 cr in 2011-12.
Management Discussion and Analysis WATCHES AND ACCESSORIES DIVISIONGlobal Watches MarketIn 2011, the global wrist watches market was estimated at around
the same level as in the previous year (1,050 million units). This
absence of volume growth was on account of the economic stress
in developed markets like Japan and Europe. In contrast, Asia
reported good double-digit growth and the US indicated
reasonable recovery.
Swiss watches, which represent the luxury and premium segment,
reported handsome sales growth of 19.2% in 2011. This was driven
by a significant 30% increase in Asian consumption, which absorbed
a remarkable 55% of all Swiss watch exports. The margins of the
Swiss industry were however adversely impacted by volatile
exchange rates, including a strong Swiss Franc.
The Swatch group continued to be the global market leader in
watches with total sales in 2011 exceeding seven billion Swiss
Francs. Revenues of this Group grew 21% at constant exchange rates
and operating profits grew 12%.
Key global trends include the rapid growth of mechanical watches,
which outstripped the growth of both quartz analog and quartz
digital watches. Despite the global market being flat over the
previous year, mechanical watches grew 9% in volume terms. This
trend appears to be gaining momentum.
Yet another significant trend is the increasing preference for steel
watches, compared to watches which sport gold or other looks.
Indian watches marketOnly 27% of all Indians own a watch. This statistic demonstrates the
significant potential for growth, particularly as Indians become more
affluent and style-conscious.
The Indian watches market is estimated at around 53 million units in
2011, valued at approximately Rs. 4,500 cr. The market grew by about
14% in 2011. The catalysts for category growth includes overall
economic progress, expanding upper-middle class and middle-class
population, growth in India’s young earning population, rising
consumerism and the spread of modern retail formats.
A large proportion of the Indian watches market is occupied by the
unorganized sector, which sells about 30 million watches each year,
primarily at the low-end of the market. These include inexpensive
watches assembled legally by small players but a large part also
comprises smuggled watches and fakes. There is need for concerted
and statutory action to curb some of these unscrupulous practices.
The organized Indian watches market is dominated by Titan, with a
market share exceeding 65%. Over the past few years, the market
has witnessed the entry of several global players who are investing
significantly in their respective brands. These include Timex, Seiko,
Swatch Group, Casio, Citizen, Guess and Fossil, among others.
Despite such intense competition, Titan successfully grew sales
(including exports) to 15.6 million watches during 2011-12,
compared with 13.5 million watches during the previous year. The
Company’s market share in multi-brand outlets also grew to about
47% during 2011-12, a handsome gain of 2% over the previous year.
The reasons include a strong portfolio of brands (Titan, Sonata,
Fastrack and Xylys), which has grown even stronger; innovative
marketing and advertising efforts; expansion of retail and sales
network and an innovative series of new watch designs which have
captivated consumers.
AccessoriesOver the last few years, there has been a successful transformation
of the Company’s watches segment into a ‘watches and accessories’
business. This strategic transformation seeks to graduate brands into
desirable lifestyle properties across a range of personal accessories,
leveraging lifestyle values like trust, style and imagery.
In pursuance of this objective, the Company’s youth brand Fastrack
launched sunglasses, bags, belts, wallets and wristbands nationally to
cater to college-going youth. Fastrack sunglasses with sales of more
than 1 million units in 2011-12, emerged as the largest selling in its
national category. Fastrack bags are widely sought by youngsters.
Total income
(Rs. in cr)
9,000
10,000
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
02010-11
6,571
8,971
2011-12
Income -Watches Division
(Rs. in cr)
1,800
1,600
1,400
1,200
1,000
800
600
400
200
02010-11
1,309
1,592
2011-12
Income -Jewellery Division
(Rs. in cr)
8,0007,0006,0005,0004,0003,0002,0001,000
02010-11
5,014
7,045
2011-12
Income - Other products
(Rs. in cr)
400
350
300
250
200
150
100
50
02010-11
248
334
2011-12
Net profit
(Rs. in cr)
700
600
500
400
300
200
100
02010-11
430
600
2011-12
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28th Annual Report 2011-12
12
Titan, the Company’s flagship brand, also launched stylish leather
belts and wallets and based on their encouraging response, will now
be extended nationally.
Marketing and advertisingThe Company implemented a number of effective marketing and
advertising initiatives. Celebrity endorsements by Aamir Khan,
Katrina Kaif, Mahendra Singh Dhoni, Virat Kohli, Genelia Deshmukh
and Farhan Akhtar enhanced brand appeal. Catchy taglines like ‘Be
More’ (for Titan), ‘Wait Mat Kar’ (Sonata) and ‘Move on’ (Fastrack)
enhanced recall. The brands also leveraged the power of online and
digital marketing to reach consumers.
Network expansionThe Company possesses the largest retail and distribution network for
watches and accessories in India. Its watches are available in over 9,000
multi-brand dealer outlets in more than 2,500 Indian towns. Its
proprietary showroom network has grown rapidly: World of Titan retail
chain added 23 stores in 2011-12 leading to 334 stores across 132 towns.
The Fastrack retail chain added 62 stores in 2011-12 leading to 106 stores
and kiosks across 49 towns. The Company has 730 service centres in
270 towns, which provide reliable and timely after-sales services.
HeliosThe Company launched the Helios retail concept in 2009, addressing
a growing preference for premium and luxury watches. This network
leverages Titan’s established competence in retailing and branding
with the objective to create India’s finest chain of premium watches
stores while catalyzing market growth. Helios retails more than 35
international watch brands comprising Tag Heuer, Seiko, Citizen,
Casio, Fossil, Diesel, Tommy Hilfiger, FCUK and DKNY in addition to
the Company’s Titan and Xylys brands. By end 2011-12, the
Company established 25 Helios stores across 11 cities, generating
an encouraging response.
International presenceIn addition to the Company’s dominant presence in India, it also sells
watches in 28 countries primarily those of Asia. These countries
comprise Vietnam, Malaysia, Singapore, Bangladesh, Sri Lanka and
Thailand in Far East Asia and Saudi Arabia, UAE, Qatar, Oman and
Kuwait in the Middle-East. It is also present in select African countries
like South Africa and Kenya. The Titan brand has emerged among
leading mid-segment brands in a number of these countries
through sound consumer understanding and innovative marketing.
Acquisition of Favre LeubaIn 2011-12, a major strategic move was the acquisition of Favre
Leuba, a heritage Swiss watch brand. This brand is one of the oldest
in the industry and the acquisition provides the Company access to
a legendary brand and mechanical watch technology. The
acquisition will dovetail with Titan’s growth agenda in India’s
growing premium and luxury watch market leading to timely
launch.
Manufacturing, technology and designThe Company’s new watch assembly unit in Pant Nagar
(Uttaranchal) exceeded production of 3 million watches in 2011-12,
the highest output achieved in record time. Several interesting
quartz movements were developed by the R&D team. HTSE, a light-
powered watch, was developed by our technology team. The
Company’s watch case manufacturing plant developed new
capabilities and the Titan Design Studio launched impressive
designs in accessories and eyewear (in addition to watches).
New product collections The Company continued to launch new watch collections to
stimulate demand, comprising the following in 2011-12:
� HTSE by Titan, a hi-tech self-energised watch that is powered
entirely by light
� Raga Weaves, a collection of ladies’ watches inspired by
traditional weaving arts of India
� Dhoni collection by Sonata, celebrating several milestones and
achievements in M.S. Dhoni’s career
� Tattoo collection by Fastrack, inspired by a multitude of tattoos
which are very popular amongst youth
� Nebula Palaces collection, our first foray into the luxury watches
market. This was a collection of limited edition watches inspired
by the Rambagh Palace of Jaipur and priced well ahead of Rs. 3
lakhs per piece
� Zoop Puss-in-Boots and Shrek collection, targeted at young children
� A customized watch to celebrate the ‘Year of the Dragon’,
launched in select South East Asian markets
JEWELLERY DIVISIONDuring 2011-12, the Indian jewellery industry was affected by the
following realities:
� The price of gold rose 35% through the year
� Gold fluctuated by a wide margin during the year, leading to
uncertainty in outlook and consumer response
� The piece of polished diamonds increased more than 100%
� The government introduced the need to show a PAN card for
all transactions in excess of Rs 5 lakhs in an effort to curb the use
of black money
These realities dampened industry growth and gold imports by
India’s jewellery industry declined from 1,030 tonnes in FY11 to an
estimated 830 tonnes in FY12, a drop of 20%.
It is in this context that the Company’s sales of 19.3 tonnes in FY12
against 18.3 tonnes in FY11, an increase of 6%, needs to be
appraised.
Our Company’s brands continued to attract an increasing number
of middle/upper-middle-class quality conscious customers through
a variety of initiatives:
� Large format Tanishq stores of 10,000 sq. ft each in Kolkata and
Pune and 20,000 sq. ft in Mumbai performed exceedingly well,
providing the impetus to establish more such stores; the overall
network area grew by more than 100,000 sq. ft, the highest ever
in any one year
� Launched the Mia (jewellery for working women), Taj (inspired
by the Taj Mahal), fq (jewellery for teenagers) and Glam Gold
(fashionable traditional jewellery) collections, which were well
received
� Launched the Amitabh-Jaya Bachchan advertising campaign for
diamond jewellery, which strengthened the brand recall around
trust and purity
� Marketed the Golden Harvest Jewellery Purchase Scheme
through TV
� Consolidated the Gold Plus brand in Andhra Pradesh through
new stores and improvements in merchandise and marketing
� Commissioned a new assembly unit in Pant Nagar (Uttarakhand)
for diamond jewellery
As a result, the Division reported good growth in sales, EBIT margin
and cash flow. It also won a number of awards in terms of store
launches, marketing campaigns and supply chain innovation.
Meanwhile, the competitive landscape became increasingly
challenging, marked by regional jewellers expanding their
geographic presence, commissioning larger stores, professionalizing
their services and considering prospective IPOs. This reality will
widen the market, educate consumers, enhance an appreciation of
brand differentiation and strengthen our respect.
The first six months of CY12 were marked by the following events of
significance:
� Increase in the customs duty on gold from 1% to 2% to 4%,
which according to industry observers is encouraging
smuggling
� Introduction of excise duty and subsequent withdrawal created
a level-playing field for the organized sector
� Introduction of tax collection at source for all cash transactions
exceeding Rs 5 lakh. This is likely to have a small impact on the
Company’s prospects, since it is already facing the effects of the
PAN card in this value category since July 2011
� Cabinet ratification of compulsory hallmarking. Even as its
implementation is hazy, this will prove advantageous in the
long-term through a narrow pricing differential between the
Company and its peers
Even as a hesitant consumer mood, regulatory constraints and
increasing competition represent business challenges, our low share
of the overall market and increasing branding provide attractive
headroom. The Company will respond to this growing opportunity
by focusing on the following areas in the next two years:
15
28th Annual Report 2011-12
14
� Network expansion: The Division is targeting an addition of
200,000-250,000 sq. ft of retail space in 2012-13, double of 2011-
12 comprising a growing number of large stores
� Value: Leveraging increasing affordability of diamonds
� Design/ Collections: Four prominent launches and targeting
diverse customer segments
� Middle India: Development of markets in small towns
� New segments: Investments in the Working Women and
Solitaire categories
Through these initiatives, the Company expects to continue to lead
the industry and report superior numbers in 2012-13 as well.
EYEWEAR Global eyewear market Over the years, eyeglasses have shed their utilitarian image of being
just a vision correction contraption to becoming a key fashion
accessory. Innovative materials for lenses and frames and other
technological advances have resulted in several new designs with
superior aesthetic appeal, style and quality. Eyeglasses are
increasingly used as a facial accessory matching apparel and for
highlighting the user’s personality. The global eyewear market
primarily comprises sales of prescription frames and sunglasses and
can be divided in different segments and average retail prices as
indicated in the following table:
Indian eyewear market The eyewear market is estimated at 25-35 million units per annum.
Changing lifestyles will continue to increase the number of people
needing vision correction. The industry is largely unorganized and
therefore presents a large growth opportunity when consumer
preferences move to the organized.
During the last 3 years, this industry has seen considerable activity
in the form of network expansion, new product offerings as well as
emergence of new players - a clear indication of the potential in the
country.
Titan’s offerings at Titan Eye+ comprise frames, lenses, sunglasses,
contact lenses and accessories. The Company launched several
collections of frames and lenses (like hydrophobic lenses that repel
water) across its 205 multi-brand retail outlets. The centralised and
state-of-the-art lens manufacturing and distribution facility at
Chikkaballapur, near Bangalore enabled the division to swiftly cater
to the needs of over 75 towns, catering to specific requirements of
consumers.
The Company continued its tie-up with Sankara Nethralaya to offer
mandated training for all its store staff and qualified Optometrists.
This helps educate customers on the need for proper eyewear,
aiding informed purchase.
As per consumer feedback, Titan Eye+ gained a reputation in
providing quality eye testing through highly trained professional
staff. The Company’s retail outlets are seen as destination stores for
stylish and contemporary products.
The Company’s endeavor to introduce innovative and stylish
products was reinforced through the launch of three new
collections (Rio, Neo and Menz), which accounted for 19% of
revenues from frames. A new brand of Sunglasses ‘Cabana’ targeted
at the fashion conscious customer was launched nationally during
the third quarter of 2011-12.
The Company continued to focus on a superior consumer
experience, which reinforced through the Vista loyalty program that
was launched nationally.
Going ahead, the Division will focus on talent development and
retention in view of declining availability of quality optometrists. It
expects to standardize consumer experience across its pan-India
outlets and educate users on the need for proper eyewear.
It is the Division’s desire not only to be largest player in India but
more importantly, the most desirable eyewear solutions provider of
the country.
PRECISION ENGINEERING DIVISION The year 2011-12 was a landmark for the precision engineering
division. The business became profitable for the first time, riding
record revenues. The business positioned itself as a dependable
partner, providing customers with quality products while saving
costs.
The precision engineering business comprised the following
sub-divisions:
Precision engineering component and sub-assemblies (PECSA):
PECSA caters to the specialised requirements of the aerospace, oil
and gas and electrical sectors. It supplies parts to leading Tier One
aerospace companies through long-term contracts. PECSA received
awards from SCIATI and HAL, among others. Today, most of the near-
1000 parts manufactured by the division enjoy customer
prequalification, strengthening prospects.
Machine building and automation (MBA): MBA caters to the
assembly line automation needs of automotive and electrical
industries. Around 20 customers were acquired during the year
under report (total 60) and several export orders were completed.
The division entered the manufacture of assembly lines for medical
devices with a potential for repeat orders. A rising demand for
automation will strengthen revenues.
Global eyewear outlook The future of the global eyeglasses market remains upbeat on
account of emerging demographic trends. While the sheer increase
in the world population opens up several possibilities and
opportunities for eyeglass manufacturers and retailers, the already
aging population in excess of 45 years with poor eye vision and
symptoms of presbyopia, is expected to drive demand. The rise of
the Internet as a potent vehicle for selling eyeglasses is additionally
expected to expand the retailing reach of eyeglasses. The growing
demand of popular-priced sunglasses and robust growth outlook
for plastic frames and lenses are expected to catalyse growth of the
total eyeglasses market.
Although developed markets such as the US and Europe have been
the traditionally large revenue contributors to the global eyeglasses
market, growth in the short to medium term period is expected
from the emerging markets of Asia-Pacific and Latin America, the
former being the fastest growing.
A Global Industry Analysts, Inc. report indicates that the lenses
market remains the largest product group in the total eyeglasses
market in terms of dollar sales, while the frames market is expected
to be the fastest growing in 2007-2015.
Market range Market segment Segment average retail price
High-end Luxury > 230 Euro
Premium (fashion and designer) 130-230 Euro
Mid-range Diffusion 75-130 Euro
Lower-end Mass < 75 Euro
Discount < 30 Euro
Source: GFK data
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28th Annual Report 2011-12
16
SEGMENT WISE PERFORMANCE (Rs. in lakhs)
Year ended Year ended Consolidated Consolidated 31.3.2012 31.3.2011 Year ended 31.3.2012 Year ended 31.3.2011 (Audited) (Audited) (Audited) (Audited)
Net sales/ Income
from operations
Watches 152,976 127,195 153,807 127,898
Jewellery 706,416 505,480 706,416 505,480
Others 32,881 24,386 32,881 24,356
Corporate (Unallocated) 976 636 1,186 1,229
Total 893,249 657,697 894,290 658,993
Profit/ (Loss) from segments before
interest and taxes and after share
of loss of associate
Watches 21,676 19,172 21,793 19,292
Jewellery 69,755 48,298 69,755 48,298
Others (448) (1,806) (448) (1,806)
Total 90,983 65,664 91,100 65,784
Less: interest 4,371 3,452 4,373 3,454
Unallocable expenditure 2,768 2,312 2,693 2,010
net of unallocated income
Profit before taxes 83,844 59,900 84,034 60,320
Capital Employed
Watches 50,398 37,813 52,233 38,549
Jewellery 63,863 50,468 63,863 50,468
Others 17,107 11,356 17,107 11,356
Corporate (Unallocated) 14,374 9,823 13,670 10,168
Total 145,742 109,460 146,873 110,541
HUMAN RESOURCES The Company strengthened recruitments to reinforce its future-
readiness. It added a net 896 employees during the year under
report (total 6,102 as on 31 March 2012). Of this, 3,083 members
were engaged in factories, 2,673 in retail, sales and marketing and
346 in support functions.
The Company continued to emphasize its ‘people first’ policy,
making it possible for the Company to report one of the industry’s
lowest attrition rates (9.5%).
The Company rejuvenated competence through training and
personal development on the one hand and lateral movements
across functions and divisions on the other, which translated into
high engagement and exposure to new opportunities.
The Company’s fair and transparent remuneration policies
strengthened talent attraction. Besides, members were assessed for
variable pay through corporate, divisional and individual
performance. The management continued to enjoy cordial industrial
relations with the Titan Employees Union, resulting in motivation,
efficiency and productivity.
During the year, the Company introduced online learning through
the SAMVIT initiative extended to all supervisory and managerial
employees. This initiative was introduced in alliance with a leading
global organization in the field of learning systems. The e-learning
offering comprised more than 3,000 learning subjects (business to HR
and soft skills), e-books and over 100 certification programs. The facility
also includes leadership-based modules with videos from renowned
global practitioners. This initiative touched more than 1,200 active
users across various subjects leading to their intellectual renewal.
Integrated Retail Services Group The Integrated Retail Services Group was responsible for the highest
ever network expansion during 2011-12, setting up a total of 200 stores
(2,74,810 sq. ft). The network as on 31st March 2012 was as follows:
During 2012-13, the Company has augmented plans to add 225
stores in Watches and Accessories, 55 stores in Jewellery and 45
stores in Eyewear.
How the Company fared The Company achieved 37% growth in sales turnover; profit before
tax increased 40% while profit after tax grew 39% over the previous
year. Key financial indicators comprise:
No of stores Area (in sq. ft)
World of Titan 332 3,39,265
Fastrack 102 49,300
Helios 25 41,657
Tanishq 129 3,87,052
Goldplus 32 66,674
Zoya 2 6,628
Eye+ 205 1,45,737
Service Centers 928 38,000
2011-12 2010-11 2009-10 2008-09 2007-08
Sales to Net Fixed assets (No. of times) 22.79 21.92 17.11 13.09 10.77
Sales to debtors (No. of times) 55.00 57.80 50.24 36.22 31.53
Sales to inventory (No. of times) 3.12 3.30 3.51 3.20 2.98
Retained earnings 380.13 301.00 173.14 115.08 108.72
% of Net profit for the year 63.3% 69,9% 69.2% 72.4% 72.4%
Return on Capital Employed (EBIT) 62.2% 58,5% 45..4% 34.2% 34.8%
Return on Net worth 48.5% 49.2% 39.2% 32.2% 39.4%
19
28th Annual Report 2011-12
18
Outlook for 2012-13The robustness of the Indian economy is reflected in the fact that
despite challenging headwinds, the Euro-zone crisis and a
substantially weaker Rupee, India’s GDP is expected to grow by
about 6.5% in 2012-13.
The Company’s Watches Division is optimistic of growth through
continued network expansion in India, sustained investment in
brands, introduction of new product collections and deeper inroads
into Vietnam, Singapore, Malaysia, South Africa and Saudi Arabia.
The Company expects to increase market share for Fastrack and
Titan accessories.
The Company’s Jewellery Division expects to introduce innovative
collections and widen its network.
The Company’s Eyewear Division will launch new models,
progressively manufactured within to reduce costs, enhance quality,
strengthen the supply chain and respond to customer needs faster.
It will also focus on standardizing customer experience across stores.
With a view to integrate operations and leverage opportunities, the
Company appointed regional business heads effective 1st April 2012
to catalyse the growth of various divisions.
The new introduction of the Unified Loyalty Programme and the E-
commerce for internet sales will be launched in 2012-13 promising
much greater satisfaction and convenience to customers.
Risks, threats and concerns The Company’s risk mitigation initiatives helped it prosper during
periods of economic turbulence.
In the face of inflation and rising interest rates, consumers either
reduced or deferred purchases. The Company countered this reality
through the creation of new needs through the innovative launch of
aesthetic products and collections. The launch of Mia and fq jewellery
collections targeted working women and teenagers with success.
The Company’s franchisee-led retail network expansion (lower-cost vis-
à-vis direct ownership) bears risks of real estate appreciation and network
attrition. The Company manages these risks through initiatives – sharing
of best operating practices and necessary support – that graduate
franchisees into partners. During 2011-12, the Company created the
Integrated Retail Services Group (IRSG) with the responsibility to
negotiate strategic real estate locations for the best rates.
The retail-driven franchisee approach also comprises risks arising
out of malpractices (including pilferage) by business associates and
employees. In view of this, the Company makes comprehensive
checks on the background of its associates and employees coupled
with ongoing surveillance, stock audits, frisking and surveillance
equipment investment.
Some of the risks specific to each of the Company’s business are
indicated below:
Watches and Accessories Division� High competition on account of entry of several foreign brands
might impact Titan’s market share. The Company meets
emerging competition through continuous and focused
investments in brands, continuous launch of innovative product
collections, increasing our retail network and through rapid
expansion of our premium retail chain Helios. During the year,
we launched several new products (detailed earlier in this
report) and have established more than 100 new stores.
� The grey and unorganised segments can potentially erode the
Company’s market share. Launch of watches at affordable prices
would wean away purchases from the grey market, creating a
desire for the brand and the establishment of a strong and
trusted network that provides service across the country should
help mitigate these risks to a large extent.
� There is a perception that watches may be replaced by mobile
phones as time-keeping devices. The Company addresses this
risk by continuing to position watches as lifestyle accessories
and not as time-keeping devices. The Company has also
launched ‘Zoop’ collection of watches for young children, which
will develop the watch wearing habit from a young age.
� The Division continuously evaluates the make-or-buy option
(finished products and components) in the area of watches and
accessories. Rising procurement costs from international sources
present opportunities for domestic manufacture.
Jewellery Division � Rising gold prices can potentially reduce jewellery demand. To
counter this risk, the Company positioned gold jewellery as a
fashion accessory and directed its diamond business at
customers with high disposable incomes.
� The Company is engaged in discussions for sight-holder status,
which will cushion the impact of rising diamond prices. It
acquires rough diamonds in bulk, polishes and processes them
to strengthen its integration.
� The Company undertakes ongoing onsite inventory verification
to protect from fidelity risks. It consolidates third party
manufacturing facilities to strengthen control and afford higher
levels of checks and balances.
� The mandatory requirement of PAN card details for consumers
purchasing jewellery above Rs. 5 lakhs may impact demand on
account of increasing disclosures. The Company may be
relatively unaffected as its average ticket size of purchase is
considerably lower.
Eyewear Division � The large import content in the Company’s eyewear products
exposes it to currency and cost risks. It addresses these risks
through strategic long-term partnerships and the progressive
manufacture of lenses and other components.
� Human resource risks comprise unavailability of quality
manpower. The Company mitigated these risks by investing in
training centers in association with Sankara Nethralaya, making
it mandatory for recruits to undergo 60-day training.
� High lead times in lens delivery can turn customers away. The
Company created a centralised lens manufacturing unit to feed
growing product demand from more than 75 towns.
Precision Engineering Division � The Company addresses talent retention risks by attracting young
graduate engineering trainees (GET) and diploma engineers.
� The Company’s customer acquisition risks are managed by its
ability to cater to several multinational Tier-I customers in the
aerospace, Defence, oil & gas and other specialised sectors.
INTERNAL CONTROLS In 2011-12, the Company undertook the following measures to
counter occurrence of frauds/ risks particularly at the retail end:
� Formation of “Operations Control Group (OCG)” to focus on
control across retail outlets and on revenue assurance.
� Evaluation of all control processes including franchisee
evaluation by credit rating agencies for both existing franchisees
and new appointments.
� Emphasis on whistle blower policy by way of further
communication to employees and business associates by the
Managing Director.
The Company’s internal audit system is geared towards ensuring
adequate internal controls to meet the increasing size and
complexity of business, for safeguarding the assets of the Company,
identifying weaknesses and areas of improvement and to meet with
all compliances.
The internal audit program focuses primarily on checks and controls
on systems and processes, monitoring compliances, continuous
upgrade of controls and the current business risk assessment. This
process enables reporting of significant audit observations to the
Audit Committee. The Audit Committee reviews the audit
observations and monitors the implementation through action
reports taken.
During the year, the leading division-wise business risks of the
Company covering all the divisions were updated. The Audit
Committee recommends risk mitigation initiatives acted upon by
the management and other personnel.
A fraud risk assessment (FRA) review was conducted by an external
agency that evaluated overall control effectiveness, identified fraud
vulnerability and recommended additional controls for enhanced
anti-fraud effectiveness. The FRA exercise identified 571 risks, of
which most were addressed while mitigation initiatives are
underway for the rest.
Cautionary statement Statements in the Management Discussion and Analysis describing
the Company’s objectives, projections, estimates and expectations
may be forward-looking statements within the meaning of
applicable securities, laws and regulations. Actual results could differ
materially from those expressed or implied. Important factors that
could make a difference to the Company’s operations include,
among others, economic conditions affecting demand/supply and
price conditions in the domestic and overseas markets in which it
operates, changes in the Government regulations, tax laws and
other statutes and incidental factors.
The report on Corporate Governance is pursuant to Clause 49 of the
Listing Agreement entered into with the Stock Exchanges and forms
a part of the report of the Board of Directors. The Company has
complied with the applicable requirements of Clause 49 of the
Listing Agreement.
A. MANDATORY REQUIREMENTS Corporate Governance PhilosophyThe Company believes that it must so govern its affairs as to
optimise satisfaction amongst all its stakeholders, which includes its
esteemed customers, providers of capital, employees, those from
whom we buy and through whom we sell, the communities in
which our primary activities take place and society at large. The
Company attaches equal importance to both means and ends - the
results sought to be secured and the methods used to achieve
them. The Company believes that, in whatever it does, it must
contribute to the economic and social development of India, a basic
tenet of the Tata Group to which your Company belongs. The
Company views the governance norms originating in the
institutions of the capital market as an integral part of its corporate
governance philosophy to be respected not just in the letter but,
more importantly, in spirit. The Company realizes that it must
disseminate information pertaining to its affairs so that all
stakeholders may gain a true understanding of its activities and
aspirations. The Company aims at attainment of the highest levels of
transparency, accountability and equity in its operations, thus
leading to best standards of Corporate Governance. It is the
Company’s belief that good ethics needs good business sense and
our business practices are in keeping with this spirit by following
the Tata Code of Conduct thereby maintaining high ethical
standards. The Company is a signatory to Global Compact, which
has social dimensions to the functioning of the corporate entity
within the ecosystem.
Board of DirectorsTitan Industries Limited was promoted by the Tamilnadu Industrial
Development Corporation Limited (TIDCO) and the Tata Group. As
on 31st March 2012, the Company had 11 Directors, comprising 10
Non-Executive Directors and 1 Executive Director.
21
28th Annual Report 2011-12
20
During the year, the Company had a Non-Executive Chairman, a
nominee of the Promoter and fifty percent of the total strength of
the Board of Directors was independent.
The Company has not had any pecuniary relationship and
transaction with any of the Non-Executive Directors during the year
under review.
The Board of Directors met six times during the Financial Year 2011-
12. Board Meetings were held on 29th April, 14th June, 28th July, 24th
October in 2011 and on 31st January, 27th & 28th March in 2012.
The information as required under Annexure 1A to Clause 49 of the
listing agreement is being regularly placed before the Board. The
Board also reviews the declaration made by the Managing Director
and Executives of the Company regarding compliance with all laws
applicable to the Company on a quarterly basis.
Attendance of each Director at the Board of Directors meetings during
the year and at the last Annual General Meeting, the number of
Directorships and Committee memberships held by them in domestic
public companies as at 31st March 2012 are as indicated below:
Corporate Governance
The composition and category of Directors as of 31st March 2012 is as follows:
Category Name of the Director No. of Directors
Nominee Directors of TIDCO (Non-Executive, Non-Independent) Dr. N. Sundaradevan1 2
Mr. V Parthasarathy
Nominee Directors of Tata Group Mr.Ishaat Hussain
(Non-Executive, Non-Independent) Mr.N.N.Tata 2
(Executive, Non-Independent) Mr. Bhaskar Bhat 1
Other Directors (Non-Executive, Independent) Mr. T.K.Balaji 6
Dr. C.G.Krishnadas Nair
Ms. Vinita Bali
Ms. Hema Ravichandar
Mr. R Poornalingam
Prof. Das Narayandas2
Total 11
1Dr.N.Sundaradevan nominee of TIDCO, was appointed as a Director of the Company on 14th June 2011. He was nominated as Chairman of the Companyin place of Mrs. Susan Mathew who resigned as Director on 24th October 2011.2 Prof. Das Narayandas, Independent Director was appointed as a Director of the Company on 29th April 2011.
Name of Director No. of Board meetings Whether attended No. of Directorships No. of Committee attended out of 6 last Annual in domestic memberships in domestic meetings of the General Meeting public companies public companies
Board of Directors (including this Company) (including this Company)As Chairman As Director As Chairman As Member
Dr. N.Sundaradevan1 2 No 8 7 2 3
Mr. Bhaskar Bhat 6 Yes 2 3 - 1
Mr. N N Tata 3 Yes - 9 1 2
Mr. Ishaat Hussain 5 Yes 2 13 3 6
Mr. T.K.Balaji 3 Yes 1 10 1 3
Dr.C.G.Krishnadas Nair 6 Yes 1 5 1 1
Ms. Vinita Bali 5 Yes - 6 - 1
Mr. V. Parthasarathy 6 Yes 1 7 - 2
Ms.Hema Ravichandar 6 Yes - 2 - 1
Mr. R Poornalingam 6 Yes - 3 - 1
Prof. Das Narayandas2 3* No - 1 - -
1Dr.N.Sundaradevan, nominee of TIDCO, was appointed as a Director of the Company on 14th June 2011.
2 Prof. Das Narayandas, Independent Director was appointed as a Director of the Company on 29th April 2011.
* participated through video conference in the Board Meeting held on 27th March 2012.
23
28th Annual Report 2011-12
22
Code of conductWhilst the ‘Tata Code of Conduct’ is applicable to all Whole-time
Directors and by definition to the Managing Director and employees
of the Company, the Board has also adopted a Code of Conduct for
Non-Executive Directors, both of which are available on the
Company’s website. All the Board members and senior
management of the Company have affirmed compliance with their
respective Codes of Conduct for the Financial Year ended March 31,
2012. A declaration to this effect, duly signed by the Managing
Director is annexed hereto.
Audit committeeThe Audit Committee of the Board was constituted in 1999. The
constitution of Audit Committee is in conformation with the
requirements of Section 292A of the Companies Act, 1956 and also
as per the requirements of Clause 49 (II) (A) of the Listing Agreement.
Powers of the Audit Committeea) to investigate any activity within its terms of reference;
b) to seek information from any employee;
c) to obtain outside legal or other professional advice; and
d) to secure attendance of outsiders with relevant expertise, if it
considers necessary.
The terms of reference of the Audit Committee are as under:
a) Oversight of the Company’s financial reporting process and the
disclosures of the financial information to ensure that the
financial statements are correct, sufficient and credible.
b) Recommending the appointment and removal of statutory
auditors, fixation of audit fees and also approval for payment for
any other services.
c) Reviewing with management the annual financial statements
before submission to the Board, focusing primarily on:
� any changes in accounting policies and practices;� major accounting entries based on exercise of judgment by
management;� qualifications in draft audit report;
� significant adjustments arising out of audit;� the going concern assumption;� compliance with accounting standards;� compliances with Listing Agreement and other legal
requirements concerning financial statements;� any related party transactions.
d) Reviewing with the management matters required to be
included in the Director’s Responsibility Statement to be
included in the Board’s report in terms of clause (2AA) of Section
217 of the Companies Act, 1956.
e) Reviewing with the management, statutory and internal
auditors and the adequacy of the internal control systems.
f ) Reviewing the adequacy of internal audit functions, including
the structure of the internal audit department; approval of the
audit plan and its execution, staffing and seniority of the official
heading the department, reporting structure, coverage and
frequency of internal audit.
g) Discussion with Internal Auditors on any significant findings and
follow up thereon.
h) Reviewing the findings of any internal investigations by the
Internal Auditors into matters where there is a suspected fraud
or irregularity or a failure of internal control systems of a material
nature and reporting the matter to the Board.
i) Discussion with Statutory Auditors before the audit commences
about the nature and scope of audit as well as post-audit
discussion to ascertain any area of concern.
j) Reviewing of management letters issued by the statutory
auditor.
k) Reviewing the Company’s financial and risk management
policies.
l) Looking into the reasons for substantial defaults in the payment
to the depositors, debenture holders, shareholders (in case of
non-payment of declared dividends) and creditors.
m) Seek assistance from the Statutory Auditors in such areas and in
such manner as desired by the Audit Committee from time to
time.
n) Reviewing the functioning of the Whistle Blower mechanism.
o) Reviewing Management Discussion and Analysis of financial
condition and results of operations.
p) Reviewing with the Management, the quarterly financial
statements before submission to the Board of Directors for
approval.
Mr. T.K.Balaji, Chairman of the Audit Committee was present at the
last Annual General Meeting of the Company held on 28th July 2011.
As at the year-end, the Audit Committee of the Board comprised of
six members, four of them being Independent Directors. All
members are financially literate and have relevant finance and / or
audit exposure. Mr. Ishaat Hussain is a Chartered Accountant and is
a financial expert.
The Audit Committee met four times during the Financial Year 2011-
12 on 28th April, 28th July, 24th October in 2011 and on 30th
January in 2012.
The quorum as required under Clause 49 (II) (B) was maintained at
all the Meetings.
The name of the Directors who are members of the Audit
Committee and their attendance at Audit Committee Meetings are
given below:
The Managing Director, the Chief Financial Officer, the Chief
Operating Officers of Watches & Accessories, Jewellery, Prescription
Eyewear and Precision Engineering Divisions and the Head - Internal
Auditor were present at Meetings of the Audit Committee.
Representatives of the Statutory Auditors, M/s. Deloitte Haskins &
Sells and outsourced Internal Auditors, M/s. Ernst &Young Ltd, are
invited to the Meetings of the Audit Committee. The Company
Secretary acts as the Secretary of the Audit Committee.
Other Sub-Committees of the Board of Directorsa. Remuneration Committee The broad terms of reference of the Remuneration Committee are to
recommend to the Board the appointment / reappointment of
Managing Director and / or Whole-time Directors, the remuneration
including Commission payable to the Managing Director, revision
in salary to be paid from the succeeding financial year, based on
evaluation of performance for the year under consideration. The
performance evaluation is based on financial performance, market
performance etc., of the Company. The Remuneration Committee
also recommends the total remuneration payable to Non-Executive
Directors and the criteria for payment amongst the Directors. The
criteria for payment of Non-Executive Directors Commission for
Financial Year 2011-12 is attendance at the Meetings of the Board
and the Committees thereof.
The Committee met twice during the Financial Year 2011-12 on 28th
April 2011 and 31st January 2012. The Members held discussions
amongst themselves and made appropriate recommendations to
the Board.
The following Directors are the members of the Remuneration
Committee:
Mr. T K Balaji (Chairman) (Non Executive) (Independent)
Mr. Ishaat Hussain (Non Executive) (Non Independent)
Dr. N Sundaradevan1 (Non Executive) (Non Independent)
Mrs. Susan Mathew2 (Non Executive) (Non Independent)
Mr. Debendranath Sarangi3 (Non Executive) (Non Independent)
Mrs. Hema Ravichandar (Non Executive) (Independent)1Member from 31st January 20122Member up to 24th October 20113Member up to 14th June 2011**
Name of Director No. of Meetings attended& Category out of four meetings
Mr. Ishaat Hussain 4
(Non Executive) (Non Independent)
Mr. T. K. Balaji 2
(Non Executive) (Independent)
Dr. C. G. Krishnadas Nair 4
(Non Executive) (Independent)
Ms. Vinita Bali 4
(Non Executive) (Independent)
Mr. V. Parthasarathy 4
(Non Executive) (Non Independent)
Prof. Das Narayandas 1
(Non Executive) (Independent)
25
28th Annual Report 2011-12
24
b. Shareholders’ Grievance CommitteeThe Shareholders’ Grievance Committee was constituted to
specifically look into the redressal of Investors’ complaints relating
to the transfer of shares, non-receipt of Annual Reports and non-
receipt of dividends declared by the Company, etc. During the
Financial Year 2011-12, a meeting of the Shareholders’ Grievance
Committee was held on 28 March 2012. All the members were
present at the meeting. The members of the Shareholders’ Grievance
Committee are as follows:
Dr. C G Krishnadas Nair (Chairman) (Non Executive) (Independent)
Mr. Bhaskar Bhat (Executive) (Non Independent)
Mr. V Parthasarathy (Non Executive) (Non Independent)
Mr. R Poornalingam (Non Executive) (Independent)
The Compliance Officer is the Company Secretary, Mr. A R Rajaram.
c. Share Transfer CommitteeA Share Transfer Committee was constituted on 27th July 2009 to
facilitate speedy disposal of requests pertaining to transfer,
transmission, issue of duplicate share certificates etc. The Members
of the Share Transfer Committee are as follows:
Dr. C G Krishnadas Nair (Chairman) (Non Executive) (Independent)
Mr. Bhaskar Bhat (Executive) (Non Independent)
Mr. V Parthasarathy (Non Executive) (Non Independent)
Mr. R Poornalingam (Non Executive) (Independent)
d. Committee of DirectorsThe Board has constituted the Committee of Directors to approve
routine and specific matters delegated by the Board.
The Committee of Directors was re-constituted on 31st January
2012 and the present constitution is as follows:
Mr. Ishaat Hussain (Non Executive) (Non Independent)
Mr. V Parthasarathy (Non Executive) (Non Independent)
Mr. Bhaskar Bhat (Executive) (Non Independent)
Mr. R Poornalingam (Non Executive) (Independent)
The business transacted by the Committee as recorded in circular
resolutions, are placed before the Board at the next meeting, for
noting.
e. Ethics CommitteeThe Ethics Committee reviews the compliance with SEBI (Prohibition
of Insider Trading) Regulations, 1992 and any amendments thereto,
and the Tata Code of Conduct.
The composition of the Committee is as follows:
Dr. C G Krishnadas Nair (Chairman) (Non Executive) (Independent)
Mr. Bhaskar Bhat (Executive) (Non Independent)
Mrs. Hema Ravichandar (Non Executive) (Independent)
During the year 2011-12, this Committee held Meetings on 23rd July
2011 and 19th October 2011.
Mr. C. Srinivasan has been designated as Chief Ethics Officer of the
Company. The Compliance Officer designated for compliance with
SEBI Guidelines for Insider Trading, is Mr. S Subramaniam, Chief
Financial Officer with effect from 14th June 2011.
f. Nomination CommitteeNomination Committee recommends to the Board most eligible
nomination for appointment as Directors, appropriate to the
Company’s structure, size and complexity and special expertise and
experience of the Directors in related domains / field.
The composition of the Committee is as follows:
Dr. C G Krishnadas Nair (Chairman) (Non Executive) (Independent)
Dr. N. Sundaradevan1, (Non Executive) (Non Independent)
Mr. T. K. Balaji (Non Executive) (Independent)
Mr. N N Tata (Non Executive) (Non Independent)
Mr. Rajeev Ranjan2 (Non Executive) (Non Independent)1Member from 28th July 20112Member up to 14th June 2011
Subsidiary CompaniesThe Company does not have any material non-listed Indian
subsidiary Company and hence, it is not mandatory to have an
Independent Director of the Company on the Board of such
subsidiary company. The Audit Committee reviews the financial
statements, particularly, the investments made by the Company’s
non-listed subsidiary companies. The minutes of the non-listed
subsidiary companies had been placed before the Board for their
attention and major transactions and decisions of the subsidiaries,
such as inter-corporate loan / investments are effected with prior
approval by the Board of Directors of the Company.
The accounts of all the subsidiaries are placed before the Directors
of the Company on a quarterly basis and the attention of the
Directors is drawn to all significant transactions and arrangements
entered into by the subsidiary companies.
Disclosures(a) Related Party Transactions: During the year under review,
besides the transactions reported in Note 41forming part of the
financial statements for the year ended 31st March 2012 in the
Annual Report, there were no other material related party
transactions of the Company with its promoters, Directors or the
management or their relatives and subsidiaries and associates. These
transactions do not have any potential conflict with the interest of
the Company at large. The material related party transactions are
placed before the Audit Committee of the Board periodically and
placed for Board’s information once in a year. Further there are no
material individual transactions that are not in normal course of
business or not on an arm’s length basis.
(b) Disclosure of Accounting Treatment: The Company follows
Accounting Standards notified by the Central Government of India
under the Companies (Accounting Standards) Rules, 2006 and / or
by the Institute of Chartered Accountants of India in the preparation
of financial statements and has not adopted a treatment different
from that prescribed in any Accounting Standard.
(c) Risk Management: The Risk Management of the Company is
overseen by the Senior Management and the Board at various levels:
Business / Strategic Risk: The Board oversees the risks which are
inherent in the businesses pursued by the Company. The oversight
is through review/ approval of business plans, projects and
approvals for business strategy / policy.
Operational Risks: These are being mitigated by internal policies
and procedures which are updated from time to time to address
updated risks.
Financial Risks: These risks are addressed on an ongoing basis by
Treasury, Insurance and Forex Policies and Bullion Risk Management
team. Due oversight on financial risks is exercised by the Audit
Committee in its meetings.
The Company is actively engaged in assessing and monitoring the
risks of each of the businesses and overall for the Company as a
whole. The top tier of risks for the Company is captured by the
operating management after serious deliberations on the nature of
the risk being a gross or a net risk and thereafter in a prioritized
manner presented to the Board for their inputs on risk
mitigation/management efforts.
The Board engages in the Risk Management process and has set out
a review process so as to report to the Board the progress on the
initiatives for the major risks of each of the businesses that the
Company is into.
The Risk registers of each of the Business gets updated on a bi-
annual basis and is placed for due discussions at Board meetings
and appropriateness of the mitigation measures to ensure that the
risks remain relevant at any point in time and corresponding
mitigation measures are optimised.
(d) Disclosure by Senior Management: Senior Management has
made disclosures to the Board relating to all material financial and
commercial transactions stating that they did not have personal
interest that could result in a conflict with the interest of the
Company at large.
(e) CEO / CFO Certification: The Managing Director (CEO) and Chief
Financial Officer (CFO) have certified to the Board in accordance with
Clause 49 (V) of the Listing Agreement pertaining to CEO/CFO
certification for the financial year ended 31 March 2012, which is
annexed hereto.
(f ) Details of Non-Compliance: There have been no instances of
non-compliance on any matter as regards the rules and regulations
prescribed by the Stock Exchanges, Securities and Exchange Board
of India or any other statutory authority relating to capital markets
during the last three years. No penalties or strictures have been
imposed by them on the Company.
(g) Whistle Blower Policy: The Company has a whistle blower
mechanism wherein the employees can approach the management
27
28th Annual Report 2011-12
26
of the Company (Audit Committee in case where the concern
involves the Senior Management) and make protective disclosures
to the Management about unethical behaviour, actual or suspected
fraud or violation of the Company’s Code of Conduct. The Whistle
Blower Policy is an extension of the Tata Code of Conduct, which
requires every employee to promptly report to the management
any actual or possible violation of the Code or an event he becomes
aware of that could affect the business or reputation of the
Company. The disclosure reported are addressed in the manner and
within the time frames prescribed in the policy. A mechanism is in
place whereby any employee of the Company has access to the
Chairman of the Audit Committee to report any concerns. Further,
the said policy has been disseminated within the organisation and
has also been posted on the Company’s website.
(h) Secretarial Audit: Pursuant to Clause 47(c) of the Listing
Agreement with the Stock Exchanges, certificates on half-yearly
basis, have been issued by a Company Secretary-in-Practice for due
compliance of share transfer formalities by the Company. Pursuant
to SEBI (Depositories and Participants) Regulations, 1996, certificates
have also been received from a Company Secretary-in-Practice for
timely dematerialisation of the shares of the Company and for
conducting a share capital audit on a quarterly basis for
reconciliation of the share capital of the Company.
Remuneration of DirectorsManaging DirectorThe Company has during the year paid remuneration to its
Managing Director by way of salary, perquisites and commission
within the limits approved by the Shareholders. The Board of
Directors on the recommendation of the Remuneration Committee
approves the annual increment (effective April each year).
Commission is calculated based on the net profits of the Company
in a particular financial year and is determined by the Board of
Directors on the recommendation of the members of the
Remuneration Committee in the succeeding financial year, subject
to the overall ceiling as stipulated in Sections 198 and 309 of the
Companies Act, 1956. The specific amount payable to the Managing
Director is based on performance criteria laid down by the Board,
which broadly takes into account the profits earned by the
Company for the related financial year.
accordance with the provisions of Sections 198, 269, 309, 310, 311
and Schedule XIII of the Companies Act, 1956.
The Board Remuneration Committee which met on 31st January
2012 recommended the remuneration payable to Mr. Bhaskar Bhat,
Managing Director, which was approved by the Board.
The broad terms of re-appointment and remuneration payable to
the Managing Director is as under:
Period of Agreement : 5 years from 1st April 2012.
Salary : up to a maximum of Rs.10,00,000/- per
month with authority to the Board to fix the
salary within the maximum amount from
time to time.
Notice period : The Agreement may be terminated by
either party giving the other party six
months’ notice or the Company paying six
months’ salary in lieu thereof.
Severance Fees : Nil
There are no stock options issued to the Managing Director.
The re-appointment of Mr. Bhaskar Bhat, Managing Director for a
period of five years from 1st April 2012 to 31st March 2017 shall be
placed before the shareholders at the Annual General Meeting for
approval. The Company shall enter into an agreement with the
Managing Director for his terms of appointment and remuneration
payable to him upon approval by the shareholders.
Non-Executive DirectorsThe remuneration paid to Non-Executive Directors for the year 2011-
12 had been computed pursuant to Sections 198, 309, 349 & 350 of
the Companies Act, 1956.
The Commission payable to Non-Executive Directors is as per the
approval obtained from the shareholders at the Annual General
Meeting held on July 27, 2010 and is within the limits specified
under the Companies Act, 1956. The remuneration by way of
Commission to the Non-Executive Directors is decided by the Board
of Directors primarily based on attendance at the Meetings of the
Board and the Committees thereof.
The perquisites indicated above exclude gratuity and leave benefits,
as these are determined on an actuarial basis for the Company as a
whole. Commission is the only component of remuneration, which
is performance linked and the other components are fixed. The
Remuneration Committee also recommends to the Board of
Directors increase in salary of the Managing Director based on
results relating to the Company’s financial performance, market
performance and few other performance related parameters.
Mr. Bhaskar Bhat’s term as Managing Director expired on 31st March
2012. At the Board Meeting of the Company held on 31st January
2012, the Board of Directors approved the re-appointment of Mr.
Bhaskar Bhat as Managing Director for a further period of five years
from 1st April 2012 to 31st March 2017, based on the
recommendation of the Board Remuneration Committee and
subject to approval by the shareholders of the Company. The re-
appointment of Mr. Bhaskar Bhat as Managing Director will be in
Details of the remuneration to the Whole-time Director during 2011-12 are as under: (in Rs.)
Name Salary Perquisites & Allowances* Commission**
Mr. Bhaskar Bhat, Managing Director 48,00,000/- 78,18,190/- 1,90,00,000/-
* excludes leave encashment amounting to Rs. 4,00,000 paid during the financial year.** based on the recommendations of the Remuneration Committee of the Board and after taking into consideration the performance during thefinancial year 2011-12 which is payable in financial year 2012-13.
Name of Director Commission* Sitting Fees
Mr. Debendranath Sarangi 5,65,100/- 40,000/-
Mrs. Susan Mathew 3,76,700/- 20,000/-
Mr. Rajeev Ranjan 3,76,700/- 20,000/-
Dr. N Sundaradevan 24,41,800/- 60,000/-
Mr. Ishaat Hussain 37,67,100/- 2,20,000/-
Mr. N N Tata 11,30,100/- 60,000/-
Mr. T K Balaji 20,71,900/- 1,20,000/-
Dr. C G Krishnadas Nair 43,32,200/- 2,22,500/-
Ms. Vinita Bali 33,90,400/- 1,80,000/-
Mr. V Parthasarathy 39,55,500/- 2,07,500/-
Mrs. Hema Ravichandar 30,13,700/- 1,75,000/-
Mr. R Poornalingam 24,48,700/- 1,27,500/-
Prof. Das Narayandas 11,30,100/- 60,000/-
* Gross amount, subject to tax and payable in Financial Year 2012-13
During the Financial Year 2011-12, the Company has paid Sitting
Fees to Non Executive Directors detailed below and proposes to
pay commission as shown below:- (Rs.)
Name of Director Number of Shares
Mr. Debendranath Sarangi NIL
Mr. Rajeev Ranjan NIL
Mr. N N Tata 46,900
Mr. Ishaat Hussain 14,060
Mr. T K Balaji 5,61,000
Dr. C G Krishnadas Nair NIL
Ms. Vinita Bali NIL
Mr. V. Parthasarathy NIL
Ms. Hema Ravichandar NIL
Mr. R. Poornalingam NIL
The Managing Director is not eligible to receive sitting fees as per
the terms of appointment and the contract entered into with him.
Sitting fees and Commission payable to the Directors, who are
nominees of the co-promoters viz., TIDCO are being paid directly
to TIDCO.
Details of shares of the Company held by Non-Executive Directors
as on 31st March 2012 are as below:
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28th Annual Report 2011-12
28
Particulars of the past three Annual General Meetingsa) Location, date and time of Annual General Meetings held during the last 3 years:
Year Location Date Time
2008-2009 At the Registered Office of the Company located at 27th July 2009 2:30 p.m.
3,SIPCOT Industrial Complex, Hosur 635 126
2009-2010 -do- 27th July 2010 3:00 p.m.
2010-2011 -do- 28th July 2011 3:00 p.m.
The Details of the voting pattern are as below:
1) Ordinary Resolution under Section 31 of the Companies Act, 1956 for alteration of the Memorandum of Association of the Company for
increase in Authorized Share Capital:
Ballots Votes %
Votes in favour 3,377 2,71,97,490 99.81
Votes against 25 18,767 0.07
Invalid votes 342 30,588 0.12
Total valid votes 3,744 2,72,46,845 100.00
2) Special Resolution under Section 31 of the Companies Act, 1956 for alteration of the Articles of Association of the Company for increase
in Authorized Share Capital:
Ballots Votes %
Votes in favour 3,265 2,72,05,129 99.85
Votes against 27 1,165 0.00
Invalid cotes 452 40,658 0.15
Total valid votes 3,744 2,72,46,952 100.00
3) Ordinary Resolution under Article 150(a) of the Articles of Association of the Company for issue of Bonus Shares in the ratio of 1 equity
share for every 1 equity share held:
Ballots Votes %
Votes in favour 3,355 2,71,95,305 99.81
Votes against 18 18,670 0.06
Invalid votes 371 33,023 0.13
Total valid votes 3,744 2,72,46,998 100.00
b) No Extra-Ordinary General Meeting of the shareholders was held
during the year.
c) A Postal Ballot was conducted during the financial year 2011-12
pursuant to Section 192A of the Companies Act, 1956, read with
the Companies (passing of Resolutions by Postal Ballot) Rules,
2001, for obtaining approval of the shareholders for the
following:
i) Ordinary Resolution for alteration of the Memorandum of
Association of the Company for increase in Authorized Share
Capital.
ii) Special Resolution for alteration of the Articles of Association of
the Company for increase in Authorized Share Capital.
iii) Ordinary Resolution for issue of Bonus Shares in the ratio of 1
(one) equity share for every 1 (one) equity share held.
iv) Ordinary Resolution for alteration of capital clause in the
Memorandum of Association of the Company for sub-division of
equity shares of a face value of Rs.10 each into 10 equity shares
of Re.1 each.
v) Special Resolution for alteration of the Articles of Association of
the Company to reflect the sub-division of the equity share
capital of the Company.
The postal ballot was conducted by the Registrars and Share Transfer
Agents of the Company, TSR Darashaw Ltd under the overall
supervision of the Company Secretary and Mr. B.R. Bahl, M/s. B.R.Bahl
& Associates, Company Secretaries in whole-time practice, the
Scrutinizer appointed by the Company.
Means of CommunicationWhether half-yearly reports are sent to each household of shareholders? : No, the financial results are published in the Newspapers, as
required under the Listing Agreements
Quarterly Results : -do-
Website, where results are displayed : The results are displayed on www.titan.co.in
Whether it also displays official news releases : Yes
Website for investor complaints : Pursuant to the amended listing agreements with the Stock
Exchanges Clause 47(f ) has been inserted for an exclusive e-
mail ID for redressal of investor grievances. Accordingly, the
Company has created an exclusive ID [email protected] for
this purpose.
Presentations to institutional investors or analysts : Presentations made during the year to institutional investors
are displayed in www.titan.co.in
Newspapers in which results are normally published : The quarterly results were published in The Business Standard,
Financial Express, Business Line, The Mint and Dina Thanthi. The
audited financial results for the year ended 31-March-2012,
were published in Financial Express, Business Line, The Mint
and Dina Thanthi.
Whether Management Discussion and Analysis is a part of the Annual Report : Yes
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28th Annual Report 2011-12
30
4) Ordinary Resolution under Section 94 of the Companies Act, 1956 for alteration of the capital clause in the Memorandum of Association
of the Company for sub-division of the equity shares of the face value of Rs. 10 each into 10 equity shares of Re. 1 each:
Ballots Votes %
Votes in favour 3,301 2,72,06,835 99.85
Votes against 57 5,658 0.02
Invalid votes 386 34,117 0 13
Total valid votes 3,744 2,72,46,610 100.00
The votes cast in favour of the above stated Resolutions were in excess of 99% of the total valid votes received in each case and consequently,
the five Resolutions mentioned in the Notice dated 5th May 2011 had been passed with the requisite majority. The results of the Postal Ballot
were put up in the notice board of the Company at the Registered Office at Hosur and informed to the Stock Exchanges where the Company’s
shares were listed.
d) Special Resolutions passed in previous 3 Annual General Meetings:
At the Annual General Meeting held on 28th July 2011, a Special Resolution was passed for the re-appointment of Statutory Auditors,
Deloitte Haskins & Sells for financial year 2011-12, which was passed unanimously.
At the Annual General Meeting held on 27th July 2010, Special Resolutions were passed:
1) For the re-appointment of Statutory Auditors, Deloitte Haskins & Sells for financial year 2010-11, which was passed unanimously
2) For payment of remuneration by way of commission to directors who are neither in whole-time employment of the Company nor
managing director(s) of the Company, which was passed unanimously.
At the Annual General Meeting held on 27th July 2009, a Special Resolution was passed for the re-appointment of Statutory Auditors,
Deloitte Haskins & Sells for financial year 2009-10, which was passed unanimously.
5) Special Resolution under Section 31 of the Companies Act, 1956 for alteration of the Articles of Association of the Company to reflect
the sub-division of equity shares:
Ballots Votes %
Votes in favour 3,213 2,71,98,694 99.82
Votes against 56 4,926 0.02
Invalid votes 475 43,545 0.16
Total valid votes 3,744 2,72,47,165 100.00
General Shareholder InformationAGM: Date, time and venue : Tuesday, 31st July 2012, 3.00 p.m. at the Registered Office of the Company at 3, SIPCOT
Industrial Complex, Hosur 635 126, Tamil Nadu
Financial Year : 1st April 2011 to 31st March 2012
Directors seeking appointment / re-appointment : As required under Clause 49(IV)(G), particulars of Directors seeking appointment / re-
appointment are given in the Explanatory Statement annexed to the Notice of the
Annual General Meeting to be held on 31st July 2012.
Book Closure Date : 17th July 2012 to 31st July 2012 (both days inclusive)
Dividend payment date : On or after 31st July 2012 (within the statutory time limit of 30 days) subject to
shareholders’ approval.
Financial Calendar Period (tentative) : Board Meeting to approve quarterly financial results
- Quarter ending 30th Jun 2012 - 31st July 2012
- Quarter ending 30th Sep 2012 - End October 2012
- Quarter ending 31st Dec 2012 - End January 2013
- Quarter ending 31st Mar 2013 - April / May 2013
Registered Office : 3, SIPCOT Industrial Complex, Hosur 635 126, Tamil Nadu
Listing of Equity Shares on Stock Exchanges : Bombay Stock Exchange Limited, Mumbai
National Stock Exchange of India Limited, Mumbai
Listing fees : Listing fees as prescribed have been paid to the above stock exchanges up to 31st
March 2013.
Share Registrar and Transfer Agents : TSR Darashaw Limited
6-10, Haji Moosa Patrawala Industrial Estate, 20, Dr E Moses Road, Mahalaxmi,
Mumbai - 400 011
E-mail: [email protected]
Website: www.tsrdarashaw.com
Tel No: 022-66568484
Fax No: 022-66568494
Company Secretary & Contact Address Mr. A.R. Rajaram,
Head- Legal & Company Secretary
Golden Enclave, Tower - B, 7th Floor, HAL Airport Road,
Bangalore 560 017
E-mail: [email protected]
Tel No: 080-66609610
Fax No: 080-2526 3001 / 2526 9923
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28th Annual Report 2011-12
32
For the convenience of investors based in the following cities, transfer documents and letters will also be accepted at the following branches:
of M/s TSR Darashaw Limited:-
TSR Darashaw Limited TSR Darashaw Limited
503, Barton Centre, 5th Floor Tata Centre, 1st Floor
84, M.G. Road, 43, Jawaharlal Nehru Road
Bangalore – 560 001 Kolkata – 700 071
Tel: 080-25320321 Tel: 033 - 22883087
Fax: 080 – 25580019 Fax: 033 - 22883062
Email: [email protected] Email: [email protected]
TSR Darashaw Limited TSR Darashaw Limited
Plot No.2/42, Sant Vihar Bungalow No.1, ‘E’ Road
Ansari Road, Daryaganj Northern Town, Bistupur
New Delhi – 110 002 Jamshedpur – 831 001
Tel: 011 – 23271805 Tel: 0657 – 2426616
Fax: 011 – 23271802 Fax: 0657 – 2426937
Email: [email protected] Email: [email protected]
Share Transfer SystemTransfer of shares in physical form has been delegated by the Board to certain officials of the Registrars, to facilitate speedy service to the
shareholders. Shares sent for transfer in physical form are registered by the Registrar and Share Transfer Agents within 20 days of receipt of
the documents, if found in order. Shares under objection are returned within two weeks. All requests for dematerialization of shares are
processed, if found in order and confirmation is given to the respective depositories i.e. National Securities Depository Ltd (NSDL) and Central
Depository Services Limited (CDSL) within 15 days.
Shah Consultancy Services Limited
c/o. TSR Darashaw Limited
3-Sumatinath Complex,
Pritam Nagar, Akhada Road,
Opp. Kothawala Flats,
Ellisbridge, Ashram Road,
Ahmedabad - 380 006
Telefax: 079 - 2657 6038,
Email: [email protected]
Investor ServicesNumber of complaints from shareholders during the year ended March 31, 2012
Complaints outstanding as on 1st April 2011 1
Complaints received during the year ended 31st March 2012 58
Complaints resolved during the year ended 31st March 2012 57
Complaints pending as on 31st March 2012 2
Stock performanceMarket Price Data - Bombay Stock Exchange Ltd
Month Bombay Stock Exchange (in Rs.) BSE SensexHigh Low
April 2011 205.87 189.96 19,135.96
May 2011 219.60 188.57 18,503.28
June 2011 235.75 212.05 18.845.87
July 2011 233.25 213.50 18,197.20
August 2011 228.15 197.35 16,676.95
September 2011 235.00 205.75 16,453.76
October 2011 225.65 197.45 17,705.01
November 2011 221.90 177.95 16,123.46
December 2011 191.05 156.10 15,454.92
January 2012 206.15 173.00 17,193.55
February 2012 244.20 194.65 17731.12
March 2012 247.80 223.75 17,404,20
Performance of Titan share price in comparisonwith BSE SENSEX
20,000 300
TitanBSE Sensex
01 A
pr 1
1
27 A
pr 1
1
23 M
ay 1
1
18 Ju
n 11
14 Ju
l 11
09 A
ug 1
1
04 S
ep 1
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30 S
ep 1
1
26 O
ct 1
1
21 N
ov 1
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17 D
ec 1
1
12 Ja
n 12
07 F
eb 1
2
04 M
ar 1
2
30 M
ar 1
2
250
150
200
100
19,000
18,000
17,000
16,000
15,000
Performance of Titan share price in comparisonwith NSE Nifty
7,000 300
TitanNSE Nifty
01 A
pr 1
1
29 A
pr 1
1
27 M
ay 1
1
24 Ju
n 11
22 Ju
l 11
19 A
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16 S
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14 O
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1
11 N
ov 1
1
09 D
ec 1
1
06 Ja
n 12
03 F
eb 1
2
02 M
ar 1
2
30 M
ar 1
2
250
150
200
100
6,500
6,000
5,500
5,000
4,500
4,000
35
28th Annual Report 2011-12
34
Distribution of shares according to size, class and categories of shareholders as on 31st March 2012
No. of Equity Shares Held No. of Shareholders Percentage No. of Shares Percentage
1-5000 119,916 96.33 65,135,616 7.34
5001-20000 3,705 2.98 32,552,006 3.67
20001-30000 200 0.16 4,841,066 0.54
30001-40000 102 0.08 3,640,953 0.41
40001-50000 75 0.06 3,462,886 0.39
50001-100000 157 0.13 11,434,627 1.29
100001- 1000000 262 0.21 84,439,633 9.51
1000001 and above 64 0.05 682,279,373 76.85
TOTAL 124,481 100.00 887,786,160 100.00
Categories of shareholding as on 31st March 2012
Category No. of Share holders No. of Shares Held % of Shareholding
Tamil Nadu Industrial Development Corporation Ltd. 1 247,476,720 27.88
Tata Group Companies 12 223,531,200 25.18
FFI / FIIs / OCBs 323 132,840,113 14.97
Bodies Corporate 1,985 21,658,146 2.43
Institutional Investors 43 11,208,358 1.26
Mutual Funds 68 29,080,715 3.28
Nationalised Banks 6 18,200 -
Others 122,043 221,972,708 25.00
Total 124,481 887,786,160 100.00
Top ten shareholders: The Company’s top ten shareholders as at 31st March 2012 are as shown below:
Sl. No. Name Holdings % to total holding
1. TAMILNADU INDUSTRIAL DEVELOPMENT CORPORATION LTD 247,476,720 27.88
2. TATA SONS LIMITED 96,345,411 10.85
3. KALIMATI INVESTMENT COMPANY LIMITED 77,555,840 8.74
4. JHUNJHUNWALA RAKESH RADHESHYAM 66,629,100 7.51
5. JHUNJHUNWALA REKHA RAKESH 22,116,120 2.49
6. TATA INVESTMENT CORPORATION LTD 17,225,640 1.94
7. TATA CHEMICALS LIMITED 13,826,180 1.56
8. MATTHEWS PACIFIC TIGER FUND 13,593,760 1.53
9. FID FUNDS (MAURITIUS) LIMITED 10,723,023 1.21
10. TATA GLOBAL BEVERAGES LIMITED 9,248,060 1.04
Stock performanceMarket Price Data - National Stock Exchange of India Ltd
Month National Stock Exchange of India Ltd (in Rs.) NSE NiftyHigh Low
April 2011 206.21 189.83 5,749.50
May 2011 220.40 188.63 5,560.65
June 2011 235.73 212.00 5,647.40
July 2011 233.30 213.60 5,482.00
August 2011 228.80 196.90 5,001.30
September 2011 235.75 205.65 4,943.25
October 2011 226.55 197.35 5,326.60
November 2011 221.90 177.65 4,832.05
December 2011 191.45 156.20 4,624.30
January 2012 206.45 172.90 5,199.25
February 2012 243.85 194.50 5,375.50
March 2012 247.95 223.85 5,295.55
STOCK CODEEquity Shares - Physical form Bombay Stock Exchange Ltd : 500114
National Stock Exchange of India Ltd : TITAN
Equity Shares - Demat form NSDL / CDSL : ISIN No. INE280A01028
The Aggregate Non-promoter / Public Shareholding of the Company as at March 31, 2012 is as shown below:
Number of Shares : 41,67,78,240 Shares
Percentage to total holding : 46.95%
37
28th Annual Report 2011-12
36
Dematerialisation of shares and liquidityAs on 31st March 2012, 96.76 % of the Company’s Equity Capital was held in dematerialised form with NSDL and CDSL. Trading in equity
shares of the Company is permitted only in dematerialised form with effect from 15.02.1999 as per the notification issued by the Securities
and Exchange Board of India (SEBI).
Outstanding GDRs / ADRs / Warrants or any Convertible Instruments : None
Stock option scheme : None
Plant locations Watch Plants: (a) Plot Nos. 3, 4 & 5 SIPCOT Industrial Complex, Hosur 635 126, Tamil Nadu
(b) Mohabewala Industrial Area, Dehradun 248 002, Uttaranchal
(i) Unit : Khasra No. 148D, 173B,176A and 176B
(ii) Unit : Khasra No. 148B, 149B
(c) Plot No. C1, C2,C3, Khasra No.37, Village Bantakheri, Tehsil - Roorkee, District - Haridwar, Uttaranchal
(d) Plot No. 10B, Khasra Nos. 150,151,152,153, Sector 2, Integrated Industrial Estate, SIDCUL,
Pant Nagar 263 153, Udham Singh Nagar District, Uttarkhand
Precision Engineering Plants: (a) No.15 B, Bommasandra Industrial Area, Hosur Road, Anekal Taluk, Bangalore 562 158, Karnataka
(b) Plot Nos. 27 & 28, SIPCOT Industrial Area, Hosur 635 126, Tamil Nadu
Jewellery Plants: (a) 29, SIPCOT Industrial Complex, Hosur 635 126, Tamil Nadu
(b) Khasra No. 238, Kuanwala Dehradun 248 001, Uttaranchal
(c) Plot No. 10A, Sector II E, SIDCUL, Pantnagar, Dist. Udham Singh Nagar, Uttarkhand
Prescription Eyewear Lens Laboratory: Plot No. 27, Survey No.125, KIADB Industrial Area, Chikaballapur 562 101 Karnataka
Addresses for correspondenceRegistered Office: 3, SIPCOT Industrial Complex, Hosur 635 126, Tamil Nadu
Corporate Office: Golden Enclave, Tower A, HAL Airport Road, Bangalore 560 017, Karnataka
B. NON MANDATORY REQUIREMENTS As far as the non-mandatory requirements are concerned, the Board has set up a Remuneration Committee to recommend appointment /
re-appointment of Managing Director and Whole-Time Directors and to recommend / review remuneration of the Managing Director, Whole-
time Directors and Non Executive Directors.
The Board has adopted a whistle-blower policy which enables the employees to report concerns about unethical behaviour, actual or
suspected fraud or violation of the Company’s code of conduct. The policy provides direct access to the Chairman of the Audit Committee
under certain circumstances. The policy has been communicated to the employees.
There was no audit qualification in the Company’s financial statements during the financial year 2011-12. The Company continues to adopt
best practices to ensure a regime of unqualified financial statements.
Chief Executive Officer (CEO) and Chief Financial Officer (CFO) Certification as per Clause 49(V) ofthe Listing Agreement
April 30, 2012
The Board of Directors,
Titan Industries Limited
3, SIPCOT Industrial Complex, Hosur 635 126
Certification to the Board pursuant to Clause 49(V) of the Listing Agreement
Bhaskar Bhat S Subramaniam
Managing Director Chief Financial Officer
We, Bhaskar Bhat, Managing Director and S. Subramaniam, Chief Financial
Officer, hereby certify that in respect of the Financial Year ended on March
31, 2012
1. we have reviewed the financial statements and the cash flow statements
for the year and that to the best of our knowledge and belief:-
a) these statements do not contain any materially untrue statement or
omit any material fact or contain statements that might be
misleading;
b) these statements together present a true and fair view of the
Company’s affairs and are in compliance with existing accounting
standards, applicable laws and regulations;
2. there are, to the best of our knowledge and belief, no transactions
entered into by the Company during the year which are fraudulent, illegal
or violative of the Company’s Code of Conduct;
3. we accept responsibility for establishing and maintaining internal
controls for financial reporting and we have evaluated the effectiveness
of the internal control systems of the Company pertaining to financial
reporting and we have disclosed to the auditors and the Audit
Committee, deficiencies in the design or operation of internal control, if
any, of which we are aware and the steps taken or proposed to be taken
to rectify the same;
4. we have indicated to the auditors and the Audit Committee : -
a) significant changes, if any, in internal control over financial reporting
during the year;
b) significant changes, if any, in accounting policies during the year and
the same have been disclosed in the notes to the financial
statements; and
c) instances of significant fraud, if any, wherein there has been
involvement of management or an employee having a significant
role in the Company’s internal control system over financial
reporting.
Declaration by the CEO under Clause 49 I (D) of the Listing Agreement regarding adherence tothe code of conduct
for Titan Industries Limited
BHASKAR BHAT
25 June 2012 Managing Director
In accordance with Clause 49 sub-clause I (D) of the Listing Agreement with the Stock Exchanges, I hereby confirm that, all the Directors and the Senior
Management personnel of the Company have affirmed compliance to their respective Codes of Conduct, as applicable to them for the Financial Year ended
March 31, 2012.
28th Annual Report 2011-12
38
CERTIFICATE
For Deloitte Haskins & Sells.
Chartered Accountants
(Registration No. 008072S)
V. Srikumar
Partner
Bangalore, 25th June 2012 (Membership No. 84494)
To the Members of TITAN INDUSTRIES LIMITED
We have examined the compliance of conditions of Corporate Governance by Titan Industries Limited, for the year ended March 31, 2012, as stipulated in Clause
49 of the Listing Agreement of the said Company with stock exchanges.
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination has been limited to a review of the
procedures and implementation thereof, adopted by the Company for ensuring compliance with the conditions of the Corporate Governance as stipulated
in the said clause. It is neither an audit nor an expression of opinion on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us and the representations made by the Directors and the
management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in Clause 49 of the above mentioned
Listing Agreement.
We state that such compliance is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness with which the
management has conducted the affairs of the Company.
39
AUDITORS’ REPORT
1. We have audited the attached Balance Sheet of TITAN
INDUSTRIES LIMITED (“the Company”) as at 31st March, 2012,
the Statement of Profit and Loss and the Cash Flow Statement
of the Company for the year ended on that date, both annexed
thereto. These financial statements are the responsibility of the
Company’s Management. Our responsibility is to express an
opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with the auditing
standards generally accepted in India. Those Standards require
that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and the disclosures in
the financial statements. An audit also includes assessing the
accounting principles used and the significant estimates made
by the Management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
3. As required by the Companies (Auditor’s Report) Order, 2003
(CARO) issued by the Central Government in terms of Section
227(4A) of the Companies Act, 1956, we enclose in the
Annexure a statement on the matters specified in paragraphs
4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to in
paragraph 3 above, we report as follows:
(a) we have obtained all the information and explanations
which to the best of our knowledge and belief were
necessary for the purposes of our audit;
(b) in our opinion, proper books of account as required by law
have been kept by the Company so far as it appears from
our examination of those books;
(c) the Balance Sheet, the Statement of Profit and Loss and
the Cash Flow Statement dealt with by this report are in
agreement with the books of account;
(d) in our opinion, the Balance Sheet, the Statement of Profit
and Loss and the Cash Flow Statement dealt with by this
report are in compliance with the Accounting Standards
referred to in Section 211(3C) of the Companies Act, 1956;
(e) in our opinion and to the best of our information and
according to the explanations given to us, the said
accounts give the information required by the Companies
Act, 1956 in the manner so required and give a true and
fair view in conformity with the accounting principles
generally accepted in India:
(i) in the case of the Balance Sheet, of the state of affairs
of the Company as at 31st March, 2012;
(ii) in the case of the Statement of Profit and Loss, of the
profit of the Company for the year ended on that
date; and
(iii) in the case of the Cash Flow Statement, of the cash
flows of the Company for the year ended on that
date.
5. On the basis of the written representations received from the
Directors as on 31st March, 2012 and taken on record by the
Board of Directors, we report that none of the Directors is
disqualified as on 31st March, 2012 from being appointed as a
director in terms of Section 274(1)(g) of the Companies Act,
1956.
For DELOITTE HASKINS & SELLSChartered Accountants
(Registration No. 008072S)
V. SrikumarPartner
Chennai, 30 April, 2012 (Membership No. 84494)
TO THE MEMBERS OF TITAN INDUSTRIES LIMITED
4140
Titan Industries Limited
ANNEXURE TO THE AUDITORS’ REPORT(Referred to in paragraph 3 of our report of even date)
i) Having regard to the nature of the Company’sbusiness/activities/results, clauses (iii) (f ), (iii) (g), (xii), (xiii), (xiv)and (xx) of CARO are not applicable.
ii) In respect of fixed assets:a) The Company has maintained proper records showing
full particulars, including quantitative details and situationof fixed assets.
b) The fixed assets were physically verified during the yearby the Management in accordance with a regularprogramme of verification which, in our opinion, providesfor physical verification of all fixed assets at reasonableintervals. According to the information and explanationgiven to us, no material discrepancies were noticed onsuch verification.
c) The fixed assets disposed off during the year, in ouropinion, do not constitute a substantial part of the fixedassets of the Company and such disposal has, in ouropinion, not affected the going concern status of theCompany.
iii) In respect of its inventories:a) As explained to us, inventories were physically verified
during the year by the Management at reasonableintervals.
b) In our opinion and according to the information andexplanations given to us, the procedures of physicalverification of inventories followed by the Managementwere reasonable and adequate in relation to the size ofthe Company and the nature of its business.
c) In our opinion and according to the information andexplanations given to us, the Company has maintainedproper records of inventories and no materialdiscrepancies were noticed on physical verification.
iv) a) During the year, the Company has not granted any loans,secured or unsecured, to companies, firms or other partiescovered in the Register maintained under Section 301 ofthe Companies Act, 1956. In respect of unsecured loans,granted to such a party in earlier years, the maximumamount involved at any time during the year and the yearend balance is Rs. 240.54 lakhs. The balance has been fullyprovided as no recoveries are expected and thereforeclauses (iii) (b) to (d) of CARO are not applicable.
b) The Company has not taken any loans, secured orunsecured, from companies, firms or other parties listed inthe Register maintained under Section 301 of theCompanies Act, 1956.
v) In our opinion and according to the information and explanations given to us, having regard to the explanations that
some of the items purchased/sold are of a special nature andsuitable alternative sources are not readily available forobtaining comparable quotations/ prices, there is an adequateinternal control system commensurate with the size of theCompany and the nature of its business with regard topurchase of inventory and fixed assets and for the sale of goodsand services. During the course of our audit, we have notobserved any major weaknesses in such internal controlsystem.
vi) In respect of the contracts or arrangements entered in theRegister maintained in pursuance of Section 301 of theCompanies Act, 1956, to the best of our knowledge and beliefand according to the information and explanations given to us:
a) The particulars of contracts or arrangements referred to inSection 301 that need to be entered in the Registermaintained under the said Section have been so entered.
b) Where each of such transaction is in excess of Rs.5 lakhsin respect of any party, and having regard to ourcomments in paragraph (v) above, the transactions havebeen made at prices which are prima facie reasonablehaving regard to the prevailing market prices at therelevant time .
vii) According to the information and explanations given to us, theCompany has not accepted any deposits from the publicduring the year. In respect of unclaimed deposits, the Companyhas complied with the provisions of Sections 58A, 58AA andother relevant provisions of the Companies Act, 1956.
viii) In our opinion, the Company has an adequate internal auditsystem commensurate with the size and the nature of itsbusiness.
ix) We have broadly reviewed the cost records maintained by theCompany pursuant to the Companies (Cost AccountingRecords) Rules, 2011 prescribed by the Central Governmentunder Section 209(1)(d) of the Companies Act, 1956 and are ofthe opinion that prima facie the prescribed cost records havebeen maintained. We have, however, not made a detailedexamination of the cost records with a view to determinewhether they are accurate or complete.
x) According to the information and explanations given to us inrespect of statutory dues:
a) The Company has generally been regular in depositingundisputed statutory dues, including Provident Fund,Investor Education and Protection Fund, Employees’ StateInsurance, Income-tax, Sales tax, Wealth tax, Service tax,Customs duty, Excise duty, Cess and other materialstatutory dues applicable to it with the appropriateauthorities.
vi) The Company has neither accumulated lossses at the end ofthe financial year nor it has incurred cash losses during thecurrent financial year and in the immediately precedingfinancial year.
vii) In our opinion and according to the information andexplanations given to us, the Company has not defaulted inrepayment of dues to banks, financial institutions anddebenture holders.
viii) The Company has not given any guarantee for loans takenfrom banks or financial institutions.
ix) In our opinion and according to the information andexplanations given to us, the term loan has been applied forthe purpose for which it was obtained.
x) In our opinion and according to the information andexplanations given to us and on an overall examination of theBalance Sheet we report that, funds raised on short term basishave not been used during the year for long term investment.
xi) The Company has not made any preferential allottment ofshares to parties and companies covered in the Registermaintained under Section 301 of the Companies Act, 1956.
xii) As per the information and explanations given to us, theCompany has created security in respect of debentures issued.
xiii) To the best of our knowledge and according to theinformation and explanations given to us, no fraud by theCompany and no material fraud on the Company has beennoticed or reported during the year.
For DELOITTE HASKINS & SELLSChartered Accountants
(Registration No. 008072S)
V. SrikumarPartner
Chennai, 30 April, 2012 (Membership No. 84494)
b) There were no undisputed statutory dues, includingProvident Fund, Investor Education and Protection Fund,Employees’ State Insurance, Income-tax, Sales tax, Wealthtax, Service tax, Customs duty, Excise duty, Cess and othermaterial statutory dues in arrears as at 31st March 2012,for a period of more than six months from the date they
become payable.
c) Details of dues of Income-tax, Sales tax, Wealth tax,Service tax, Customs duty, Excise duty and Cess whichhave not been deposited as on 31st March, 2012 onaccount of any disputes are given below:
Name of Statute Nature of Amount Period to which the Forum where Dispute is pendingthe Dues (Rs. in lakhs) amount relates
Income-tax Act, 1961 Income tax 2.39 1997-98 High Court
25.21 2002-03 Income Tax Appellate Tribunal
Sales Tax Laws Sales tax 71.55 2000-01 High Court
176.54 2003-04, 2005-06 , 2008-09 Additional Commissioner of Sales Tax
210.80 2000-01, 2002-03, 2003-04, Deputy Commissioner of Sales Tax
2004-05, 2005-06
32.56 2005-06 Joint Commissioner (Appeals) of Sales Tax
5.99 2004-05 Assistant Commissioner of Sales Tax
6.28 2010-11 Commercial Tax Inspector of Sales Tax
The Customs Act, 1962 Customs duty 316.94 1989-94 Supreme Court
The Central Excise duty 2,272.59 May 2005 to March 2009 Supreme Court
Excise Act, 1944
0.42 July 2001 to July 2002 High Court
285.88 March 1987 to February 1990, Customs, Excise and Service Tax Appellate Tribunal
April 1995 to October 1998 and 2001- 09
108.73 March 2002 to February 2003, July 2007 to February 2009, Commissioner of Central Excise (Appeals)
October 2009 to February 2010 and July 2009 to December 2010
7,030.25 September 2005 to July 6, 2009 Commissioner of Central Excise
9.54 July 1999 to November 1999 Additional Commissioner of Central Excise
421.38 1996 - 97, 1998-2001, 2004 – 07, Assistant Commissioner of Central Excise
April 2008 to March 2011
4342
Titan Industries Limited
Balance Sheet as at 31 March 2012(` lakhs)
Note As at As atParticulars No. 31-03- 2012 31-03-2011
I. EQUITY AND LIABILITIES(1) Shareholders’ Funds
(a) Share capital 2.1 8877.86 4438.93 (b) Reserves and surplus 2.2 136111.82 98099.03
144989.68 102537.96(2) Non-current liabilities
(a) Long-term borrowings 3 588.89 945.11 (b) Deferred tax liabilities (Net) 11 – 151.82 (c) Other long-term liabilities 4 1144.20 253.08 (d) Long-term provisions 5 5755.29 4152.38
7488.38 5502.39(3) Current liabilities
(a) Trade payables 6 175015.29 152270.09 (b) Other current liabilities 7 118790.76 95390.09 (c) Short-term provisions 8(a) 23669.30 17855.60
317475.35 265515.78Total 469953.41 373556.13
II. ASSETS(1) Non-current assets
(a) Fixed assets(i) Tangible assets 9(a) 35775.45 26956.62 (ii) Intangible assets 9(b) 1097.06 1350.23 (iii) Capital work-in-progress 2485.21 1664.28
(b) Non-current investments 10 1604.90 912.76 (c) Deferred tax asset (Net) 11 377.49 –(d) Long-term loans and advances
(i) Capital advances (Unsecured and considered good) 577.30 271.35 (ii) Other advances 12 12216.78 11881.40
54134.19 43036.64(2) Current assets
(a) Inventories 13(a) 287866.90 199382.87 (b) Trade receivables 14 16310.94 11367.89 (c) Cash and bank balances 15 96053.00 109649.90 (d) Short-term loans and advances 16 12325.08 8559.38 (e) Other current assets 17 3263.30 1559.45
415819.22 330519.49 Total 469953.41 373556.13
See accompanying notes forming part of the financial statements.
In terms of our report attachedFor DELOITTE HASKINS & SELLS For and on behalf of the Board of DirectorsChartered Accountants
Bhaskar Bhat N. Sundaradevan ChairmanManaging Director Ishaat Hussain
V. Srikumar T K BalajiPartner S.Subramaniam K Dhanavel
Chief Financial Officer C.G.Krishnadas NairVinita Bali DirectorsV ParthasarathyR Poornalingam
A.R.Rajaram Hema RavichandarChennai, 30 April 2012 Head-Legal & Company Secretary Das Narayandas
See accompanying notes forming part of the financial statements.
In terms of our report attachedFor DELOITTE HASKINS & SELLS For and on behalf of the Board of DirectorsChartered Accountants
Bhaskar Bhat N. Sundaradevan ChairmanManaging Director Ishaat Hussain
V. Srikumar T K BalajiPartner S.Subramaniam K Dhanavel
Chief Financial Officer C.G.Krishnadas NairVinita Bali DirectorsV ParthasarathyR Poornalingam
A.R.Rajaram Hema RavichandarChennai, 30 April 2012 Head-Legal & Company Secretary Das Narayandas
Statement of Profit & Loss for the year ended 31 March 2012(` lakhs)
Note Current PreviousParticulars No. Year Year
I. Revenue from operations (gross) 18 897085.87 657086.38
Less: Excise duty 13248.03 4996.87
Revenue from operations (net) 883837.84 652089.51
II. Other Income 19 9411.40 5607.63
III. Total Revenue (I +II) 893249.24 657697.14
IV. Expenses:
Cost of materials and components consumed 28(a) 614508.16 434487.82
Purchase of traded goods 28(b) 115088.28 84958.23
(Increase)/ decrease in finished goods, work-in-progress and traded goods 20 (75185.13) (50028.14)
Employee benefits expense 21 39234.34 36513.00
Finance costs 34 4371.53 3451.73
Depreciation and amortization expense 4489.62 3448.25
Other expenses 22 106898.55 84966.16
Total Expenses 809405.35 597797.05
V. Profit before tax (III - IV) 83843.89 59900.09
VI. Tax expense:
(1) Current tax 23890.00 16860.00
(2) Deferred tax (529.31) (323.67)
(3) Taxes of earlier years 467.61 322.26
Total Tax 23828.30 16858.59
VII. Profit after tax (V-VI) 60015.59 43041.50
VIII. Earnings per equity share of `1 (2011 : ` 10) each:
(1) Basic 42 6.76 4.85
(2) Diluted 6.76 4.85
4544
Titan Industries Limited
Cash Flow Statement for the year ended 31 March 2012(` lakhs)
Note Current PreviousParticulars No. Year Year
A. CASH FLOW FROM OPERATING ACTIVITIES
Net profit before tax 83843.89 59900.09
Adjustments for :
– Depreciation / Amortisation 4489.62 3448.25
– Unrealised exchange difference (net) 2918.16 141.45
– Marked to Market loss 33.92 118.08
– Loss on sale/ disposal/ scrapping of fixed assets (net) 225.91 180.81
– Bad debts written off 720.64 48.32
– Provision for doubtful debts / advances (net) (556.89) (13.81)
– Interest income (9305.26) (5511.17)
– Dividend income (0.44) (1.14)
– Interest expense 4371.53 3451.73
Operating profit before working capital changes 86741.08 61762.61
Adjustments for :
– (Increase)/decrease in sundry debtors (5103.52) (1995.29)
– (Increase)/decrease in inventories (88484.03) (65349.72)
– (Increase)/decrease in loans and advances (2846.54) (2158.49)
– Increase/(decrease) in current liabilities and provisions 51029.34 130076.71
Cash generated from operations 41336.33 122335.82
– Direct taxes paid (25586.50) (17224.32)
Net cash from operating activities 15749.83 105111.50
B. CASH FLOW FROM INVESTING ACTIVITIES
Additions to fixed assets (including capital work in progress and advances on capital account) (13667.82) (6456.88)
Proceeds from sale of fixed assets 150.87 84.97
Purchase of investments- Others (1074.22) (150.00)
Proceeds from redemption of investments – 0.13
Dividends received 0.44 1.14
Interest received 7601.41 3972.75
Net cash used in investing activities (6989.32) (2547.89)
Cash Flow Statement (Contd.) for the year ended 31 March 2012(` lakhs)
Note Current PreviousParticulars No. Year Year
C. CASH FLOW FROM FINANCING ACTIVITIES
Repayment of borrowings (5807.24) (542.22)
Dividends paid (11018.54) (6615.83)
Tax on dividends paid (1800.26) (1105.88)
Interest paid (4817.56) (3428.75)
Net cash used in financing activities (23443.60) (11692.68)
Net cash flows during the year (A+B+C) (14683.09) 90870.93
Cash and bank balances (opening balance) 109649.90 18671.84
Add :Cash and bank balances acquired on amalgamation (Refer Note 23) 832.18 –
Add : / ( Less) :Unrealised exchange (gain) / loss (64.36) 42.77
110417.72 18714.61
Cash and bank balances (closing balance) 96053.00 109649.90
Add : / ( Less) :Unrealised exchange (gain) / loss (318.37) (64.36)
95734.63 109585.54
Increase / (decrease) in cash and bank balances (14683.09) 90870.93
See accompanying notes forming part of the financial statements.
In terms of our report attachedFor DELOITTE HASKINS & SELLS For and on behalf of the Board of DirectorsChartered Accountants
Bhaskar Bhat N. Sundaradevan ChairmanManaging Director Ishaat Hussain
V. Srikumar T K BalajiPartner S.Subramaniam K Dhanavel
Chief Financial Officer C.G.Krishnadas NairVinita Bali DirectorsV ParthasarathyR Poornalingam
A.R.Rajaram Hema RavichandarChennai, 30 April 2012 Head-Legal & Company Secretary Das Narayandas
4746
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012 Notes forming part of the Financial Statements for the year ended 31 March 2012
Note 01 SIGNIFICANT ACCOUNTING POLICIES
The financial statements have been prepared on an accrual basis under the historical cost convention in accordance with the accounting
principles generally accepted in India and materially comply with the mandatory Accounting Standards notified by the Central Government
of India under The Companies (Accounting Standards) Rules, 2006 (as amended), and by the Institute of Chartered Accountants of India and
with the relevant provisions of the Companies Act,1956.
The revised Schedule VI notified under the Companies Act, 1956, for preparation and presentation of financial statements has become
applicable to the Company for the year ended March 31, 2012. The adoption of revised Schedule VI does not impact the recognition and
measurement principles followed for preparation of financial statements. However, it has significant impact on the presentation and disclosure
of the financial statements. The Company has also reclassified the prior year figures in accordance with the requirements applicable for the
current year.
i. Use of estimates: The preparation of the financial statements in conformity with the generally accepted accounting principles requires
the management to make estimates and assumptions that affect the reported amount of assets and liabilities, revenues and expenses
and disclosure of contingent liabilities. Such estimates and assumptions are based on management's evaluation of relevant facts and
circumstances as on the date of financial statements. The actual outcome may diverge from these estimates.
ii. Revenue recognition: Revenue from sale of goods is recognised when the substantial risks and rewards of ownership are transferred to
the buyer which generally coincides when the goods are dispatched from the factory/ stock points / or delivered to customers as per
the terms of the contract. Service revenue is recognised on rendering services.
Interest income is recognised on a time proportion basis, taking into account the amount outstanding and the rate applicable.
Dividend income is recognised when the Company's right to receive the payment is established.
iii. Tangible fixed assets: All fixed assets are stated at cost less accumulated depreciation. Cost includes purchase price and all other
attributable costs of bringing the assets to working condition for intended use.
Capital work-in-progress comprises the cost of fixed assets that are not ready for their intended use at the balance sheet date.
iv Depreciation: Depreciation has been provided on the straight line method in accordance with the Companies Act, 1956, except for the
following, which are based on the useful life of the assets estimated by the management:
Computers – @ 25% instead of 16.21%
Vehicles – @ 25% instead of 9.50%
Furniture & Fixtures – @ 20% instead of 6.33%
v. Intangible assets and amortisation: Trademarks are capitalised at acquisition cost including directly attributable cost and are amortised
over a period of 120 months from the month of acquisition. The expected pattern of economic benefits from the use of trademarks is
reviewed periodically and additional amortisation, if required, is provided.
vi. Foreign currency transactions: Foreign currency transactions are recorded at the exchange rates prevailing on the date of the transaction.
Foreign exchange rate fluctuations relating to monetary assets and liabilities (including those relating to integral foreign operations) are
restated at year end rates or forward cover rates, as applicable. The net loss or gain arising on restatement/ settlement is adjusted to the
statement of profit and loss.
In respect of forward exchange contracts, the premium or discount arising at the inception of such a forward exchange contract is
amortized as expense or income over the life of the contract. Exchange differences on such contracts are recognised in the statement
of profit and loss of the reporting period in which the exchange rates change.
vii. Derivative Accounting: The Company uses derivative financial instruments to manage risks associated with gold price fluctuations
relating to certain highly probable forecasted transactions, foreign currency fluctuations relating to certain firm commitments and
foreign currency and interest rate exposures relating to foreign currency loan. The Company applies the hedge accounting principles
set out in Accounting Standard (AS) 30 - Financial Instruments: Recognition and Measurement and has designated derivative financial
Note 01 SIGNIFICANT ACCOUNTING POLICIES CONTD.
instruments taken for gold price fluctuations as 'cash flow' hedges relating to highly probable forecasted transactions. All such derivative
financial instruments are supported by an underlying transaction and are not for trading or speculative purposes.
The use of derivative financial instruments is governed by the Company's policies approved by the board of directors, which provide
written principles on the use of such instruments consistent with the Company's risk management strategy.
Hedging instruments are initially measured at fair value, and are remeasured at subsequent reporting dates. Changes in the fair value of
these derivatives that are designated and effective as hedges of future cash flows are recognised directly in hedging reserve and the
ineffective portion is recognised immediately in the statement of profit and loss.
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, or exercised, or no longer qualifies for
hedge accounting. For forecasted transactions, any cumulative gain or loss on the hedging instrument recognized in hedging reserve
is retained until the forecast transaction occurs upon which it is recognized in the statement of profit and loss. If a hedged transaction
is no longer expected to occur, the net cumulative gain or loss accumulated in hedging reserve is recognized immediately to the
statement of profit and loss.
Changes in the fair value of derivative financial instruments that have not been designated as hedging instruments are recognised in
the statement of profit and loss as they arise.
viii. Investments: All long term investments are valued at cost. Provision for diminution in value is made to recognise any decline, other
than temporary, in the value of investments.
ix. Transfer to debenture redemption reserve is made pro-rata over the life of the debentures in terms of the requirements of the Companies
Act, 1956.
x. Inventories: Inventories are valued at lower of cost and net realisable value. The cost of various categories of inventory is determined as
follows:
a) Gold is valued on first-in-first-out basis.
b) Consumable stores, loose tools, raw materials and components are valued on a moving weighted average rate.
c) Work-in-progress and manufactured goods are valued on full absorption cost method based on the average cost of production.
d) Traded goods are valued on a moving weighted average rate/ cost of purchases.
xi. Product warranty expenses: Product warranty costs are determined based on past experience and provided for in the year of sale.
xii. Employee Benefits:
Short term employee benefits
All short term employee benefits such as salaries, wages, bonus, special awards, medical benefits which fall due within 12 months of the
period in which the employee renders the related services which entitles him to avail such benefits and non-accumulating compensated
absences are recognised on an undiscounted basis and charged to the statement of profit and loss.
Defined Contribution plan
Company's contributions to the Superannuation Fund which is managed by a Trust and Pension Fund administered by Regional Provident
Fund Commissioner are debited to the statement of profit and loss on an accrual basis.
Contribution to the Company's Provident Fund Trust is made at predetermined rates and debited to the statement of profit and loss on
an accrual basis.
Defined Benefit Plan
Contribution to the Company's Gratuity Trust, liability towards pension of retired managing director and provision towards leave salary
benefit is provided on the basis of an actuarial valuation using the projected unit credit method and is debited to the statement of profit
and loss on an accrual basis. Actuarial gains and losses arising during the year are recognised in the statement of profit and loss.
4948
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012 Notes forming part of the Financial Statements for the year ended 31 March 2012
Note 01 SIGNIFICANT ACCOUNTING POLICIES CONTD.
xiii. Taxes on Income: Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the
provisions of the Income-tax Act, 1961.
Deferred tax is recognised on timing differences, being the difference between taxable income and accounting income that originate
in one period and are capable of reversal in one or more subsequent periods.
xiv. Segment accounting: Segments are identified based on the types of products and the internal organisation and management structure.
The Company has identified business segment as its primary reporting segment with secondary information reported geographically.
The Company's primary segments consist of Watch, Jewellery and Others, where 'Others' include Eye wear, Precision Engineering,
Machine Building, Clocks, and Accessories.
Segment assets and liabilities include all operating assets and liabilities. Segment results include all related income and expenditure.
Corporate (unallocated) represents other income and expenses which relate to the enterprise as a whole and are not allocated to
segments.
xv. Impairment of assets: Consideration is given at each Balance Sheet date to determine whether there is any indication of impairment of
the carrying amount of the assets/ cash generating units. If any indication exists, an impairment loss is recognized when the carrying
amount exceeds the greater of net selling price and value in use.
xvi. Provisions and Contingencies: A provision is recognised when the Company has a present obligation as a result of past events and it is
probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made.
Provisions are not discounted to present value and are determined based on best estimate required to settle the obligation at the
Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent
Liabilities are not recognised but are disclosed in the notes.
Contingent Assets are neither recognised nor disclosed in the financial statements.
2012 2011No. of shares Amount No. of shares Amount
in lakhs `lakhs in lakhs `lakhs
a) Authorised share capital
Equity share of `1 (2011: `10) each 12000.00 12000.00 800.00 8000.00
Redeemable cumulative preference shares of `100 each 40.00 4000.00 40.00 4000.00
b) Issued, subscribed and fully paid up share capital
Equity share of `1 (2011: `10) each fully paid up 8877.86 8877.86 443.89 4438.93
c) Rights of shareholders :
The Company has only one class of equity shareholders. Each holder of equity shares is entitled to one vote per share. The Company
declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to approval by the shareholders
at the ensuing Annual General Meeting.
d) Reconciliation of the shares outstanding at the beginning and at the end of the year
Note 2.1 SHARE CAPITAL
2012 2011No. lakhs `lakhs No. lakhs `lakhs
Equity sharesAt the beginning of the year 443.89 4438.93 443.89 4438.93
Add: Sub-division of shares 3995.04 – – –
Add : Issue of bonus shares 4438.93 4438.93 – –
At the end of the year 8877.86 8877.86 443.89 4438.93
Note 2.1 SHARE CAPITAL CONTD.
e) Shareholders holding more than 5% shares in the Company (No. in lakhs)2012 2011
Name No. of % total No. of % totalshares held holding shares held holding
Tamilnadu Industrial Development Corporation Limited 2474.77 27.88 123.74 27.88
Tata GroupTata Sons Limited 963.45 10.85 47.48 10.70
Kalimati Investment Company Limited 775.56 8.74 38.78 8.74
Tata Investment Corporation Ltd 172.26 1.94 8.61 1.94
Tata Chemicals Ltd 138.26 1.56 6.91 1.56
Tata Global Beverages Ltd (formerly Tata Tea Ltd) 92.48 1.04 4.62 1.04
Ewart Investments Ltd 49.64 0.56 2.48 0.56
Tata International Ltd 25.60 0.29 1.97 0.44
Piem Hotels Ltd 18.06 0.20 0.90 0.20
Total - Tata Group 2235.31 25.18 111.75 25.18
Jhunjhunwala Rakesh Radheshyam 666.29 7.51 33.05 7.45
2012 2011
Capital reserve 13.28 13.28 Capital redemption reserve
As per last balance sheet – –Add : On amalgamation (Refer Note 23) 64.38 –
64.38 –Share premium account 13888.27 13888.27 Debenture redemption reserve
As per last balance sheet 2597.00 2069.00 Add : Transfer from statement of profit and loss – 528.00 Less: Transfer to general reserve 2597.00 –
– 2597.00 Hedging reserve
As per last balance sheet 1.62 45.90 Add : Effects of variation in commodity prices on hedginginstruments outstanding at the end of the year 0.57 1.62 Less : Transferred to statement of profit and loss 1.62 45.90
0.57 1.62
Note 2.2 RESERVES AND SURPLUS (` lakhs)
5150
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012 Notes forming part of the Financial Statements for the year ended 31 March 2012
2012 2011
General reserve
As per last balance sheet 38337.34 24691.34
Add : Transfer from debenture redemption reserve 2597.00 –
Add : On amalgamation (Refer Note 23) 399.59 –
Less : Utilised during the year for issuing bonus shares 4438.93 –
Add : Transfer from statement of profit and loss 21631.00 13646.00
58526.00 38337.34
Surplus in the statement of profit and loss
Opening balance 43261.52 27291.61
Add : On amalgamation (Refer Note 23) 29.84 –
Add : profit for the year 60015.59 43041.50
103306.95 70333.11
Less:
Transfer to debenture redemption reserve – 528.00
Proposed dividend on equity shares 15536.26 11097.33
Tax on dividends 2520.37 1800.26
Transfer to general reserve 21631.00 13646.00
Net surplus in statement of profit and loss 63619.32 43261.52
Reserves and surplus 136111.82 98099.03
Note 2.2 RESERVES AND SURPLUS CONDT. (` lakhs)
2012 2011
Term loans
From banks - Secured
Foreign Currency loan 588.89 945.11
Total 588.89 945.11
An amount of `542.22 lakhs (2011: `542.22 lakhs) of Foreign currency loan which is repayable within 12 months have been grouped under
other current liabilities.
The above foreign currency loan aggregating `1131.11 lakhs (2011: `1487.33 lakhs) is secured by a first charge over the Company's present
and future fixed (movable and immovable) assets and is repayable in 9 semi-annual installments starting February 2010.
Note 03 LONG-TERM BORROWINGS (` lakhs)
2012 2011
Payables - capital goods 1144.20 253.08
1144.20 253.08
Note 04 OTHER LONG-TERM LIABILITIES (` lakhs)
2012 2011
Provision for Leave salaries (Refer Note 31) 5419.18 3840.66
Provision for Pension (Refer Note 31) 336.11 311.72
5755.29 4152.38
Note 05 LONG-TRM PROVISIONS (` lakhs)
2012 2011
i) Principal amounts unpaid 238.48 86.54
Interest due on above – –
238.48 86.54
ii) No interest payments have been made during the year.
iii) The above information regarding dues to Micro Enterprises and Small Enterprises has been determined to the extent such parties
have been identified on the basis of information available with the Company. This has been relied upon by the auditors.
Note 06Trade payables include amounts due to micro enterprises and small enterprises as under: (` lakhs)
2012 2011
Advances from customers {Refer note (a) below} 95053.62 66826.18
Interest accrued and not due on borrowings – 328.98
Unclaimed dividends {Refer note (b) below} 238.07 159.28
Unclaimed matured fixed deposits 4.55 5.95
Foreign currency loan repayable within 12 months (Refer note 3) 542.22 542.22
6.75% debentures repayable within 12 months {Refer note (c) below} – 5282.60
Other Liabilities - Statutory dues 4084.77 3431.14
Other Liabilities - Others 18867.53 18813.74
118790.76 95390.09
a) Advances from customers include advances received of `85663.80 lakhs (2011: `58779.77 lakhs) towards sale of jewellery products
under various sale initiatives / retail customer programmes.
b Current liabilities do not include any amount to be credited to Investor Education and Protection Fund except where there are pending
legal cases amounting to `1.40 lakhs (2011: `1.39 lakhs) and therefore, amounts relating to the same could not be transferred.
c) The 6.75% debentures redeemable at par at the end of five years from the dates of allotment on May 12, 2006 and June 09, 2006 and
secured by way of legal mortgage on the immovable properties and plant and machinery situated at Hosur were redeemed during the
year.
Note 07 OTHER CURRENT LIABILITIES (` lakhs)
2012 2011
a) Short-term provisionsProposed dividend on equity shares 15536.26 11097.33
Tax on dividends 2520.37 1800.26
Provision for Gratuity ( Refer Note 31) 892.02 1866.54
Provision for Leave salaries (Refer Note 31) 740.16 496.42
Others {Refer note (c) below} 3980.49 2595.05
Total 23669.30 17855.60
b) The Board of Directors, in their meeting on April 30, 2012, proposed a dividend of `1.75 per equity share. The proposal is subject to the
approval of shareholders at the Annual General Meeting to be held on 31 July, 2012, and if approved, would result in a cash outflow of
approximately ` 18056.63 lakhs inclusive of corporate dividend tax of ` 2520.37 lakhs.
Dividend recognized as distributions to equity shareholders for the year ended March 31, 2011 was ` 25 per share.
Note 08 (` lakhs)
5352
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012 Notes forming part of the Financial Statements for the year ended 31 March 2012
Note 08 (Contd.)
Note 09
a) Tangible AssetsGross Block
c) Others include
(i) Provision for warranty - ` 373.95 lakhs (2011: ` 264.88 lakhs).
The Company gives warranty on all products except jewellery, undertaking to repair or replace the items that fail to perform
satisfactorily during the warranty period. Warranty provisions are made for expected future outflows and determined based on
past experience. No reimbursements are expected. Provision made and utilised/reversed during the year is ` 373.95 lakhs (2011: `264.88 lakhs) and ` 264.88 lakhs (2011: ` 228.48 lakhs) respectively.
(ii) Provision for Customer Loyalty programmes - ` 3606.54 lakhs (2011: ` 2330.17 lakhs)
The Company has a scheme of reward points on purchase of certain products by customers which can be redeemed at the time
of future purchases. Provision is made based on past experience. Additional provision made and utilised/reversed during the year
is ` 3787.51 lakhs (2011: ` 3311.74 lakhs) and ` 2511.14 lakhs (2011: ` 1969.01 lakhs) respectively.
(` lakhs)Gross Block
Particulars Cost as at Additions Deductions Cost as atApril 1, 2011 March 31, 2012
Land -freehold 227.19 588.41 0.16 815.44
Land - leasehold 526.60 949.28 – 1475.88
Buildings 6763.39 543.13 30.48 7276.04
Plant, machinery and equipment 45039.84 5643.36 1036.29 49646.91
Furniture, fixtures and equipment 6600.33 4942.40 423.73 11119.00
Office equipment 770.12 494.17 37.62 1226.67
Vehicles 959.97 271.31 84.86 1146.42
Total 60887.44 13432.06 1613.14 72706.36 Previous Year 56105.56 5757.80 975.92 60887.44
Note 09 (Contd.)
b) Intangible assets
Tangible Assets - Depreciation and net block (` lakhs)Depreciation Net Block
Particulars Upto For the year On As at As at As atMarch 31, 2011 deductions March 31, 2012 March 31, 2012 March 31, 2011
Land -freehold – – – – 815.44 227.19
Land - leasehold – – – – 1475.88 526.60
Buildings 2099.01 194.29 6.04 2287.26 4988.78 4664.38
Plant, machinery and equipment 27534.13 1972.23 786.94 28719.42 20927.49 17505.71
Furniture, fixtures and equipment 3713.63 1774.93 349.89 5138.67 5980.33 2886.70
Office equipment 136.32 68.66 16.58 188.40 1038.27 633.80
Vehicles 447.73 226.34 76.91 597.16 549.26 512.24
Total 33930.82 4236.45 1236.36 36930.91 35775.45 26956.62
Previous Year 31445.88 3195.08 710.14 33930.82 26956.62
2012 2011
Opening Gross Block 6327.11 6327.11
Additions during the year – –
Deductions during the year – –
Closing Gross Block 6327.11 6327.11
Opening Amortisation 4976.88 4723.71
Amortisation for the year 253.17 253.17
Deductions during the year – –
Total Amortisation 5230.05 4976.88
Net Block 1097.06 1350.23
(` lakhs)
2012 2011
Trade investments - unquotedIn subsidiary companies19,00,000 (2011 : 19,00,000) fully paid equity shares of `10 each
in Titan TimeProducts Limited 237.70 237.70
3,35,020 (2011 : 3,35,020) fully paid equity shares of ` 10 each
in Titan Properties Limited (Refer Note b) 33.59 33.59
Nil (2011 : 19,31,319) fully paid equity shares of `10 each in Tanishq (India) Limited * – 382.08
Application Money towards equity in Favre Leuba AG 1074.22 –
1345.51 653.37
In associate company15,00,000 (2011: 15,00,000) fully paid equity shares of ` 10 each 150.00 150.00
in TVS Wind Power Limited {Refer Note (a) below}
150.00 150.00
Non-Trade investments - quoted 100 ( 2011 : 100) fully paid equity shares of ` 10 each in Timex Watches Limited 0.01 0.01
1,000 ( 2011 : 1,000) fully paid equity shares of ` 10 each 0.10 0.10
in National Radio Electronics Company Limited
2,025 ( 2011 : 2,025) fully paid equity shares of `10 each in Tata Steel Limited 4.62 4.62
6000 ( 2011 : 6000) fully paid equity shares of `1 each in Tata Global Beverages Limited 2.34 2.34
560 ( 2011 : 560) fully paid equity shares of `10 each in Tata Chemicals Limited 1.40 1.40
300 ( 2011 : 300) fully paid equity shares of `10 each in Trent Limited 0.92 0.92
100 ( 2011 : 100) fully paid equity shares of `10 each in Titan Alloys Limited 0.02 0.02
100 ( 2011: 100) fully paid equity shares of `10 each in Titan Foods and Fashions Limited 0.01 0.01
100 ( 2011 : 100) fully paid equity shares of `10 each in Titan Biotech Limited 0.02 0.02
100 ( 2011 : 100) fully paid equity shares of `10 each in Titan Securities Limited 0.01 0.01
9.45 9.45
Less : Provision for diminution 0.06 0.06
9.39 9.39
carried forward 1504.90 812.76
Note 10 NON-CURRENT INVESTMENTS (` lakhs)
5554
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012 Notes forming part of the Financial Statements for the year ended 31 March 2012
2012 2011
Brought forward 1504.90 812.76
Others1,14,663 (2011: 1,14,663) fully paid equity shares of ` 50 each – –
in The Central India Spinning and Weaving Mills Limited
97,624 (2011: 97,624) fully paid equity shares of ` 25 each in Tata Mills Limited – –
400 (2011: 400) fully paid equity shares of ` 25 each in The Central India Press Limited – –
5,25,000 (2011: 5,25,000) fully paid equity shares of ` 10 each 100.00 100.00
in Innoviti Embedded Solutions Pvt. Limited
100.00 100.00
1604.90 912.76
Aggregate amount of quoted investments 9.39 9.39
Aggregate amount of unquoted investments 1595.51 903.37
Market value of quoted investments 21.63 24.10
* Shares cancelled on amalgamation
a) The Company has given an undertaking not to sell or encumber in any manner its investments in TVS Wind Power Limited in accordance
with the Equity Participation agreement.
b) A Petition has been filed by the Company’s subsidiary Titan Properties Limited as the Transferor Company, seeking sanction to the
Scheme of Amalgamation with the Company on the appointed date i.e. 1 April 2011. No shares of the Company are to be issued
pursuant to the Scheme. Based on the application made under section 391 of the Companies Act, 1956, the Chennai High Court having
jurisdiction over the Transferor Company has granted dispensation of the meetings of shareholders and creditors of the Transferor
Company. The final order sanctioning the said scheme of Amalgamation as aforesaid is awaited.
Note 10 NON-CURRENT INVESTMENTS (Contd.) (` lakhs)
2012 2011
Security deposits 7012.49 5045.00
Employee loans 1032.11 870.44
Other deposits 523.87 747.21
Tax payments net of provisions 3648.31 5218.75
12216.78 11881.40
Note 12 OTHER ADVANCES UNDER LONG TERM LOANS AND ADVANCES
(` lakhs)
2011 Tax effect 2012for the year
Deferred Tax (Liability)
Fixed assets (2349.70) 10.07 (2339.63)
Sub-total (2349.70) 10.07 (2339.63)Deferred Tax Asset
Provision for doubtful debts 241.89 (180.60) 61.29
Employee benefits 1337.76 591.23 1928.99
Others 618.23 108.61 726.84
Sub-total 2197.88 519.24 2717.12 Net Deferred Tax Asset / (Liability) (151.82) 529.31 377.49
Note 11 DEFERRED TAX ASSET
(` lakhs)Major components of deferred tax arising on account of timing differences are:
Unsecured and considered good
2012 2011
a) InventoriesRaw materials 49600.08 36069.08
Raw materials - in transit 174.16 507.40
Work-in-progress {Refer (b) below} 12100.02 8694.11
Finished goods 161953.04 115902.70
Finished goods - in transit 67.36 –
Stock in trade 62924.11 37262.59
Store and spares 533.78 456.55
Loose tools 514.35 490.44
287866.90 199382.87
b) Details of inventory of work-in-progress
Watches 7627.75 6062.11
Jewellery 2929.07 1896.64
Others 1543.20 735.36
12100.02 8694.11
Note 13 (` lakhs)
2012 2011
Trade receivables outstanding for a period exceeding six months from
the date they were due for payment
Considered good 364.68 284.90
Considered doubtful 188.65 745.54
553.33 1030.44
Less : Provision for doubtful debts 188.65 745.54
364.68 284.90
Other Trade Receivables
Considered good 15946.26 11082.99
16310.94 11367.89
Note 14 TRADE RECEIVABLES (UNSECURED) (` lakhs)
5756
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012 Notes forming part of the Financial Statements for the year ended 31 March 2012
2012 2011
Cash and cash equivalentsa) Balance with banks 7977.73 7280.77
b) Cheques, drafts on hand 881.36 385.42
c) Cash on hand 938.26 519.04
d) Short-term deposits with banks 11900.00 –
21697.35 8185.23
Other bank balancesa) Earmarked balances with banks
Unclaimed dividend 236.67 157.89
Unclaimed debenture interest 15.75 3.55
Share application money received for allotment of rights shares and due for refund 3.23 3.23
b) Fixed Deposits held as margin money against bank guarantee 1100.00 –
c) Short-term deposits with banks with more than three months maturity 73000.00 101300.00
74355.65 101464.67
Balance with banks includes funds in transit - ` 2058.14 lakhs ( 2011: ` 1555.28 lakhs)
96053.00 109649.90
Note 15 CASH AND BANK BALANCES (` lakhs)
2012 2011
Interest accrued on deposits 3263.30 1559.45
3263.30 1559.45
Note 17 OTHER CURRENT ASSETS (Unsecured and considered good, unless otherwise stated) (` lakhs)
2012 2011
Advances recoverable in cash or kind or for value to be received
From a subsidiary 15.08 101.16
From others
Advances to vendors 2000.88 2638.69
Security Deposits 1471.93 1838.86
Prepaid expenses 1160.00 794.14
Others 4101.19 1815.60
8734.00 7087.29
Considered doubtful 2224.32 2224.32
10958.32 9311.61
Less : Provision for doubtful loans and advances 2224.32 2224.32
8734.00 7087.29
Tax payments net of provisions 2799.33 –
Balance with customs and excise authorities 776.67 1370.93
12325.08 8559.38
Note 16 SHORT-TERM LOANS AND ADVANCES (Unsecured and considered good, uniess otherwise stated) (` lakhs)
Current year Previous year
Sale of productsManufactured goods
Watches 110791.53 94278.74 Jewellery 583715.87 428433.12 Others 7215.27 5584.07
701722.67 528295.93 Traded goods
Watches 40593.66 29575.08 Jewellery 111580.13 68185.01 Others 32330.89 24594.69
184504.68 122354.78 Total - Sale of products (a) 886227.35 650650.71 Sale of tools and components (b) 1171.11 1246.12 Income from services provided (c) 289.91 269.41 Other operating revenue
Sale of precious / semi-precious stones 6547.24 3230.80 Sale of gold 2170.73 1168.05 Scrap sales 679.53 521.29
Total - Other operating revenue (d) 9397.50 4920.14 Revenue from operations (gross) (a+b+c+d) 897085.87 657086.38 Less : Excise duty 13248.03 4996.87 Revenue from operations (net) 883837.84 652089.51
Excise duty of ` 13248.03 lakhs (2011: ` 4996.87 lakhs) reduced from gross revenue from operations in the statement of profit and lossrepresents excise duty on sale of products.
Note 18 REVENUE FROM OPERATIONS (` lakhs)
Current year Previous year
Interest from staff loans, vendor advances and bank deposits 9305.26 5511.17 Dividends on long-term, Non-trade investments - Others 0.44 1.14 Miscellaneous income 89.79 74.80 Other non-operating income 15.91 20.52
9411.40 5607.63
Note 19 OTHER INCOME (` lakhs)
Current year Previous year
Closing stockFinished goods 162020.40 115902.70 Work-in-progress 12100.02 8694.11 Stock-in-trade 62924.11 37262.59
237044.53 161859.40 Opening stockFinished goods 115902.70 80794.06 Work-in-progress 8694.11 10897.68 Stock-in-trade 37262.59 20139.52
161859.40 111831.26 (Increase) / decrease in inventory (75185.13) (50028.14)
Note 20 (INCREASE)/ DECREASE IN FINISHED GOODS, WORK-IN-PROGRESS AND TRADED GOODS (` lakhs)
5958
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012 Notes forming part of the Financial Statements for the year ended 31 March 2012
Current year Previous year
Salaries, wages and bonus 33617.09 31132.07
Company's contribution to provident and other funds (Refer Note 31) 1484.43 1210.62
Welfare expenses 3240.80 2303.77
Gratuity (Refer Note 31) 892.02 1866.54
39234.34 36513.00
Note 21 EMPLOYEE BENEFITS EXPENSE (` lakhs)
Current year Previous year
Loose tools, stores and spare parts consumed 7988.96 8347.07
Agency labour 3351.16 2783.53
Power and fuel 2519.89 2128.72
Repairs to buildings 361.14 178.21
Repairs to plant and machinery 997.57 858.32
Advertising 38142.33 30326.93
Selling and distribution expenses 8194.45 7275.80
Insurance 485.37 359.68
Rent 11584.47 7481.84
Rates and taxes (Refer Note 33) 11826.19 9120.02
Travel 2129.17 1888.43
Bad debts written off 720.64 48.32
Provision for doubtful debts / advances 163.75 34.51
Less : Provision for doubtful debts of earlier years written back 720.64 48.32
(556.89) (13.81)
Irrecoverable loans and advances written off – 2952.60
Less : Provision for loans and advances created earlier years – 2952.60
– –
Loss on sale / disposal / scrapping of fixed assets (net) 225.91 180.81
Gold price hedging costs (net) 305.90 114.34
General Expenses * 18587.23 13681.94
Directors' Fees 15.13 14.63
Commission to Non Whole-time Directors 290.00 210.00
Expenses capitalised (270.07) (18.62)
106898.55 84966.16
* Includes exchange gain (net) of ` 201.60 lakhs (2011: ` 254.67 lakhs)
Note 22 OTHER EXPENSES (` lakhs)
Pursuant to the Scheme of amalgamation of Tanishq (India) Limited (TQL) (wholly owned subsidiary of the Company carrying on trading
activities) with the Company as sanctioned by the High Court of Karnataka, all assets and liabilities have been transferred to and vested in
the Company retrospectively with effect from April 1, 2010.
The amalgamation has been accounted for under the "pooling of interests" method as prescribed by Accounting Standard (AS) 14 -
Accounting for Amalgamations notified by the Central Government of India under the Companies (Accounting Standards) Rules, 2006.
Accordingly, the assets, liabilities and reserves have been recorded at their respective book values in the accounts of the Company.
Note 23
Contingent Liabilities not provided for - ` 15845.16 lakhs (2011: ` 5805.51 lakhs) comprising of the following:Sales Tax - ` 543.25 lakhs (2011: ` 412.72 lakhs)(relating to the applicability of rate of tax, computation of tax liability, submission of certain statutory forms)
Customs Duty - ` 316.94 lakhs (2011: ` 316.94 lakhs)(relating to compliance with the terms of notification, export obligations)
Excise Duty - ` 10482.86 lakhs (2011: ` 3331.58 lakhs)(relating to denial of exemption by amending the earlier notification, computation of the assessable value, denial of input credit on servicetax and excise duty on jewellery)
Income Tax - ` 4027.21 lakhs (2011: ` 1289.78 lakhs)(relating to disallowance of deductions claimed)
Others - ` 474.90 lakhs (2011: ` 454.49 lakhs)(relating to miscellaneous claims)
The above amounts are based on the notice of demand or the Assessment Orders or notification by the relevant authorities, as the case maybe, and the Company is contesting these claims with the respective authorities. Outflows, if any, arising out of these claims would dependon the outcome of the decisions of the appellate authorities and the Company's rights for future appeals before the judiciary. Noreimbursements are expected.
Note 24
Estimated amount of contracts remaining to be executed on capital account and not provided for is ` 3271.38 lakhs (2011: ` 3500.99 lakhs).
Note 25
The Company had received show cause notice from the Excise authorities for ` 2016.93 lakhs without quantifying interest and penalty,
relating to the methodology of allocation and apportionment of input service tax credit. The Company has been legally advised that the
notice is not sustainable.
Note 26
a) Non-fund based facilities availed of ` 21603.00 lakhs (2011: ` 25801.32 lakhs) from banks are secured by a first charge by way of
hypothecation of current assets including book debts and inventories, both present and future. The security covered rank pari passu with
the security for the cash credit facility.
b) Estimated amount of contracts remaining to be executed on revenue account and not provided for is ` 8845.89 lakhs (2011: ` 5302.06
lakhs).
Note 27 Other Commitments
The assets and liabilities which have merged with the parent company are as under:
Cash and bank balances 832.18
Loans and advances 26.70
Investments 15.47
Current liabilities (0.57)
873.78
Note 23 (Contd.) (` lakhs)
The reserve and surplus which have been added to the parent company are as under:
Capital redemption reserve 64.38
General reserve 399.59
Surplus in statement of profit and loss 29.84
493.81
6160
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012 Notes forming part of the Financial Statements for the year ended 31 March 2012
Current year Previous year
a) Cost of materials and components consumed:Precious metals – Gold * 521975.87 366608.74
– Others 1531.94 1013.07 Brass 1671.38 1237.18 Steel 1118.92 754.03 Components 61316.58 34533.09 Precious and semi-precious stones ** 24410.20 28572.69 Sundry charges 2483.27 1769.02
614508.16 434487.82
* Includes gold sold costing ` 2106.12 lakhs (2011: ` 1027.45 lakhs)** Includes precious and semi-precious stones sold costing ` 5700.57 lakhs (2011: ` 2603.69 lakhs)
Note 28 (` lakhs)
b) Purchase of traded goods:Watches 22907.51 16187.75
Jewellery 81755.34 60711.93
Others 10425.43 8058.55
115088.28 84958.23
(` lakhs)
Current year Previous year
` lakhs % ` lakhs %ImportedCIF Value 415856.92 68 299870.36 69 Customs duties 6886.38 1 5803.44 1
422743.30 69 305673.80 70 Indigenous 191764.86 31 128814.02 30
614508.16 100 434487.82 100
Note 29 VALUE OF IMPORTED AND INDIGENOUS RAW MATERIALS AND COMPONENTS CONSUMED AND THE PERCENTAGE OF EACH TO THE TOTAL CONSUMPTION:
Current year Previous year
Raw materials and components 394966.42 289957.68
Stores and spares 781.56 581.71
Capital goods 2264.41 412.57
398012.39 290951.96
Note 30 ANALYSIS OF IMPORTS ON CIF BASIS: (` lakhs)
Current year Previous year
a. Defined Contribution Plansi) The contributions recognized in the statement
of profit and loss during the year are as under:Defined Contribution Plan Provident Fund 823.62 669.06 Superannuation Fund 317.62 268.00 Employee Pension Fund (EPF) 343.19 273.56 Total 1484.43 1210.62
Note 31 EMPLOYEE BENEFITS (` lakhs)
Current year Previous year
I. Net Asset / (Liability) recognized in the balance sheet 1. Present value of funded obligations 8518.30 7292.47 2. Fair Value of Plan Assets (7626.28) (5425.93)3. (Deficit) / surplus (892.02) (1866.54)4. Net Asset / Liability
– Assets– Liabilities - Current 892.02 1866.54
II. Expense recognized in the statement of profit and loss1. Current Service Cost 540.50 373.63 2. Interest Cost 643.32 452.67 3. Expected Return on Plan Assets (419.80) (327.18)4. Actuarial Losses/ (Gains) 128.00 1364.12 5. Past Service Cost – 3.30
Total expenses recognised under the head 'Gratuity' (Refer note 21) 892.02 1866.54 III. Change in present value of obligation 1. Present value of Defined Benefit Obligation at the beginning of the year 7292.47 5126.23 2. Current Service Cost 540.50 373.63 3. Interest Cost 643.32 452.67 4. Actuarial Losses/ (Gains) 156.22 1392.32 5. Past Service Cost – 3.30 6. Benefits Paid (114.21) (55.68)7. Present value of Defined Benefit Obligation at the end of the year 8518.30 7292.47 IV Change in fair value of Plan assets 1. Fair value of plan assets at the beginning of the year 5425.93 4191.14 2. Expected Return on Plan assets 419.80 327.19 3. Actuarial (Losses)/ Gains 28.22 28.20 4. Assets distributed on settlement – –5. Contributions by employer 1866.54 935.08 6. Benefits Paid (114.21) (55.68)7. Fair value of plan assets at the end of the year 7626.28 5425.93
Actual Return on Plan assets 448.02 355.39 V The major categories of Plan Assets as a percentage of total Plan Assets 1. Government of India Securities 51% 45%2. Corporate bonds 45% 51%3. Others 4% 4%
The following table sets out the funded status and amounts recognised in the Company's financial statements for Gratuity: (` lakhs)
ii) Contributions are made to the Company's Employees Provident Fund Trust at predetermined rates in accordance with the Fundrules. The interest rate payable by the Trust to the beneficiaries is as notified by the Government. The Company has an obligationto make good the shortfall, if any, between the return from the investments of the Trust and the notified interest rate and recognizessuch shortfall as an expense. Based on the actuarial valuation, there is no shortfall in the interest payable by the Trust to thebeneficiaries as on the balance sheet date.
b. Defined Benefit Plans(i) Funded
The Company makes annual contributions to The Titan Industries Gratuity Fund. The scheme provides for lump sum payment tovested employees at retirement, death while in employment, or on termination of employment as per the Company's GratuityScheme. Vesting occurs upon completion of five years of service.
Note 31 EMPLOYEE BENEFITS (Contd.)
6362
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012 Notes forming part of the Financial Statements for the year ended 31 March 2012
Note 31 EMPLOYEE BENEFITS (Contd.)
(` lakhs)2012 2011 2010 2009 2008
Defined Benefit Obligation 8518.30 7292.47 5126.23 4039.92 3387.36
Plan Assets 7626.28 5425.93 4191.14 3569.57 2877.94
Surplus / (Deficit) (892.02) (1866.54) (935.09) (470.35) (509.42)
Experience adjustments on Plan Liabilities 373.15 501.56 184.56 225.18 185.42
Experience adjustments on Plan Assets 28.22 28.20 9.78 82.95 4.29
VI. Experience Adjustments
VII. Principal actuarial assumptions Discount Rate 8.55% p.a 8.35% p.a
Expected Rate of Return on Plan Assets 7.50% p.a 7.50% p.a
VIII. The employees are assumed to retire at the age of 58 or 60 years.
IX. The mortality rates considered are as per the published rates in the LIC (1994-96) mortality tables.
Expected rate of return on plan assets is based on average yield on investments. The Company is expected to contribute ` 800.00 lakhs to the gratuity
fund for the year ending 31 March 2013.
(ii) Unfunded
The defined benefit obligations which are provided for but not funded are as under:
The discount rate is based on the prevailing market yields of Indian Government securities as at the balance sheet date for the estimated term of the
obligations.
The estimate of future salary increases considered, takes into account the inflation, seniority, promotion, increments and other relevant factors.
Liability as on Liability as onMarch 31, 2012 March 31, 2011
Compensated absences / Leave salary
Non-current 5419.18 3840.66
Current 740.16 496.42
6159.34 4337.08
Pension - Non-current 336.11 311.72
(` lakhs)
Auditors remuneration comprises of fees for audit of statutory accounts ` 102.00 lakhs (2011: ` 85.00 lakhs), taxation matters ` 31.29 lakhs
(2011: ` 24.77 lakhs), audit of consolidated accounts ` 8.40 lakhs (2011: ` 7.00 lakhs), other services ` 27.88 lakhs (2011: ` 21.90 lakhs) and
reimbursement of levies and expenses ` 17.44 lakhs (2011: ` 19.13 lakhs).
Note 32
Finance costs include gold on lease charges of ` 3834.04 lakhs (2011 : ` 2630.76 lakhs) and interest on income tax of ` 117.95 lakhs
(2011: ` 68.23 lakhs).
Note 34
Revenue expenditure directly attributable to research and development is estimated at ` 330.26 lakhs (2011: ` 301.69 lakhs)
Note 38
Rates and Taxes include the following:
i) ` 1909.72 lakhs (2011: ` 1763.99 lakhs) being the difference in excise duty included in closing stock and opening stock of finished goods.
ii) ` 4180.50 lakhs (2011: ` 3650.94 lakhs) being the excise duty paid on watch components transferred from Hosur factory to Dehradun,
Baddi, Roorkee and Pantnagar factories.
Note 33
Current year Previous year
Royalty 79.77 298.33
Professional and consultancy services 838.33 508.88
Interest 122.99 169.58
Others 1624.75 2357.02
Note 35
Expenditure in foreign currency (on payment basis) on account of: (` lakhs)
2012 2011
For a period not later than one year 3759.31 3795.56
For a period later than one year but not later than five years 4380.91 3239.87
For a period later than five years – –
Total 8140.22 7035.43
b) The Company has taken the above operating leases for non-cancellable periods ranging from 1 year to 6 years. The leases are renewable
by mutual consent.
c) Lease rentals recognised in the statement of profit and loss in respect of the above operating leases is ` 3542.66 lakhs
(2011: ` 4101.83 lakhs).
Note 39
(` lakhs)
a) The total of future minimum lease payments in respect of premises taken on lease under non-cancellable operating leases are as follows:
Current year Previous year
Export of goods on FOB basis 16047.57 12689.90
Others 35.37 25.04
Note 37 EARNINGS IN FOREIGN EXCHANGE (` lakhs)
Current year Previous year
Amount remitted by the Company in foreign currency on account of dividends(i) Number of Shareholders 4 4
(ii) Number of equity shares on which dividend was paid 347120 17456
(iii) Year to which the dividend related 2010-11 2009-10
(iv) Amount remitted (net of tax) (` lakhs) 4.34 2.62
Note 36
6564
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012 Notes forming part of the Financial Statements for the year ended 31 March 2012
a) Gold futures/forwards contracts outstanding as at the year end - 978 kgs, ` 27890.60 lakhs (2011: 26 Kgs, ` 547.51 lakhs)
b) The Company has an outstanding swap to hedge its foreign currency and interest rate exposures relating to foreign currency loan ofUS Dollars 2.22 million (2011: US Dollars 3.33 million) equivalent to ` 1131.11 lakhs (2011: ` 1487.33 lakhs).
The Company has Nil forward exchange contracts outstanding for US Dollars Nil equivalent to ` Nil (2011: 12 forward exchangecontracts for US Dollars 1.75 million; equivalent to ` 779.68 lakhs), Nil forward exchange contract for Euros Nil equivalent to ` Nil (2011:1 forward exchange contract for Euros 0.09 million equivalent to ` 53.98 lakhs) and Nil forward exchange contracts for HKD Nil equivalentto ` Nil (2011: 3 forward contracts for HKD 1.8 million equivalent to ` 102.98 lakhs) to hedge foreign currency risk of firm commitmentof sales. Further, the Company also has 3 forward exchange contracts for US Dollars 8.70 million equivalent to ` 4457.60 lakhs (2011: 16forward exchange contracts for US Dollars 22.83 million equivalent to ` 10185.30 lakhs), 3 forward exchange contracts for HKD 60 millionequivalent to ̀ 3969.50 lakhs(2011: Nil), Nil forward exchange contract for in Swiss Francs Nil equivalent to ` Nil (2011: 1 forward exchangecontract for in Swiss Francs 0.13 million equivalent to ` 61.41 lakhs) and six foreign exchange contracts for Japanese Yen 143.40 millionequivalent to ` 918.18 lakhs (2011: Nil) for firm commitment of purchases.
Marked to Market loss of ` 33.92 lakhs (2011 : ` 118.08 lakhs) has been recognized in the statement of profit and loss on theseoutstanding contracts.
c) The foreign currency exposures that are not hedged by a derivative instrument or otherwise as at March 31, 2012 are given below:
i) Amounts receivable in foreign currency as at March 31, 2012 (Previous year figures are in brackets)
Note 40
Nature of receivables ` Foreign currency
Export of goodsUSD 3046.08 59.87
(2087.15) (46.83)GBP 15.86 0.19
(18.45) (0.26)HKD 281.90 43.04
(176.24) (30.77)EURO 56.17 0.83
(97.86) (1.55)
Nature of payables ` Foreign currency
Import of goods and servicesUSD 623.45 12.25
(471.12) (10.56)EURO 60.72 0.99
(60.91) (0.96)HKD 267.32 40.75
(376.89) (65.73)CHF 23.90 0.42
(121.08) (2.48)JPY 41.59 66.87
(7.36) (13.67)GBP 318.80 3.91
(5.03) (0.07)SEK 6.18 0.81
(4.89) (0.68)SGD 5.19 0.13
(2.43) (0.07)
Names of related parties and description of relationship:
a) Promoters Tamilnadu Industrial Development Corporation Limited
Tata Sons Limited
b) Subsidiaries Titan TimeProducts Limited
Titan Properties Limited
Favre Leuba AG ( from 13 January 2012)
Tanishq (India) Limited {amalgamated during the year (Refer note 23)}
c) Associate TVS Wind Power Limited
d) Key Management Personnel Mr. Bhaskar Bhat, Managing Director
Note 41 RELATED PARTY DISCLOSURES
(` lakhs)
(Amount in lakhs)
(Amount in lakhs)
SL. Nature of transaction Promoters Subsidiaries Associate Key TotalNo. Management
Personnel
1. Purchase of components and raw materials – 1713.45 – – 1713.45 (–) (1497.61) (–) (–) (1497.61)
2. Sale of components,finished goods and fixed assets 0.02 46.45 – – 46.47 (–) (42.05) (–) (0.31) (42.36)
3. Reimbursement of expenses 2.03 – – – 2.03 (5.15) (–) (–) (–) (5.15)
4. Interest expense 37.34 – – – 37.34 (37.34) (1.19) (–) (–) (38.53)
5. Interest income – 2.81 – – 2.81 (–) (–) (–) (–) (–)
6. Rent paid 49.64 – – – 49.64 (41.36) (–) (–) (–) (41.36)
7. Purchase of power – – 188.14 – 188.14 (–) (–) (–) (–) (–)
8. Dividend paid 4280.51 – – – 4280.51 (2568.31) (–) (–) (–) (2568.31)
9. Commission and sitting fees 80.64 – – – 80.64 to non whole–time directors (58.99) (–) (–) (–) (58.99)
10. Brand equity subscription 1379.08 – – – 1379.08 (1065.30) (–) (–) (–) (1065.30)
11. Recovery of expenses – 18.78 – – 18.78 (–) (16.39) (–) (–) (16.39)
12. Payment towards rendering of services 63.31 – – – 63.31 (55.33) (–) (–) (–) (55.33)
13. Recovery towards rendering of services – 98.46 – – 98.46 (–) (83.66) (–) (–) (83.66)
14. Managerial remuneration – – – 320.18 320.18 (–) (–) (–) (301.45) (301.45)
15. Redemption of 6.75% Debentures 553.16 – – – 553.16 (–) (–) (–) (–) (–)
16 Subscription to Share capital / Application money – 1074.22 – – 1074.22 (–) (–) (150.00) (–) (150.00)
Transactions with related parties during the year are set out in the table below: (Previous year figures are in brackets)
ii) Amounts payable in foreign currency as at March 31, 2012 (Previous year figures are in brackets)
6766
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012 Notes forming part of the Financial Statements for the year ended 31 March 2012
Note 41 RELATED PARTY DISCLOSURES (Contd.)
(` lakhs)SL. Nature of transaction Promoters Subsidiaries Associate Key TotalNo. Management
Personnel
Debit balanceTitan TImeProducts Limited – 21.04 – – 21.04
(–) (101.93) (–) (–) (101.93)
Total Debit balance – 21.04 – – 21.04
(–) (101.93) (–) (–) (101.93)
Credit balanceTata Sons Ltd 948.10 – – – 948.10
(624.15) (–) (–) (–) (624.15)
Tamilnadu Industrial Development Corporation Limited 77.18 – – – 77.18
(55.66) (–) (–) (–) (55.66)
Titan Properties Limited – 0.24 – – 0.24
(–) (–) (–) (–) (–)
TVS Wind Power Limited – – 3.94 – 3.94
(–) (–) (–) (–) (–)
Mr. Bhaskar Bhat – – – 195.82 195.82
(–) (–) (–) (154.97) (154.97)
Total Credit balance 1025.28 0.24 3.94 195.82 1225.28
(679.81) (–) (–) (154.97) (834.78)
Balance as on balance sheet date The following table sets forth the computation of basic and diluted earnings per share:
(` lakhs)Nature of transaction Category Name Amount(a) Purchase of components and raw materials Subsidiary Titan TimeProducts Limited 1713.45
(1497.61)
(b) Dividend paid Promoter Tamilnadu Industrial 3093.46
Development Corporation Limited (1856.08)
Promoter Tata Sons Limited 1187.05
(712.23)
(c) Brand Equity Subscription Promoter Tata Sons Limited 1379.08
(1065.30)
(d) Redemption of 6.75% Debentures Promoter Tata Sons Limited 553.16
(–)
(e) Subscription to Share capital / Application Money Subsidiary Favre Leuba A G 1074.22
(–)
Associate TVS Wind Power Limited –
(150.00)
The above includes the following material related party transactions
2012 2011
Net profit after tax 60015.59 43041.50
a) Weighted average number of equity shares 887786160 44389308
b) i) Nominal value of shares (`) 1 10
ii) Earnings per share - Basic and diluted (`) 6.76 4.85
Note 42 EARNINGS PER SHARE
(` lakhs)
Pursuant to the approval of the shareholders through postal ballot, the Board of Directors of the Company at its Meeting held on 14 June 2011
had approved the sub-division of its equity share of the face value of ` 10 each into 10 (ten) equity shares of `1 each and also for the
capitalisation of an amount of ` 4438.93 lakhs from General reserve account of the Company towards issue and allotment as fully paid-up
bonus shares in the ratio of 1 (one) equity share for every existing equity share held by the equity shareholders on the Record date i.e.,
24 June 2011.
Consequently, the Earnings per Share (EPS) has been adjusted as required under AS-20 Earnings Per Share.
Note 43 SEGMENT INFORMATION FOR THE YEAR ENDED MARCH 31, 2012
(` lakhs)Watches Jewellery Others Corporate Total
(Unallocated)
RevenueNet sales/income 152007.71 698981.71 32848.42 – 883837.84
(There is no inter–segment revenue) (126515.13) (501202.30) (24372.08) (–) (652089.51)
Segment ResultBefore interest, other income and taxes. 20708.36 62321.31 (–)481.45 (–)3744.20 78804.02
(18492.82) (44018.28) (–1820.00) (–2946.91) (57744.19)
Add : Other Income 968.23 7434.20 32.95 976.02 9411.40
(679.09) (4278.98) (14.32) (635.24) (5607.63)
Profit before interest and taxes 21676.59 69755.51 (–)448.50 (–)2768.18 88215.42
(19171.91) (48297.26) (–1805.68) (–2311.67) (63351.82)
Less : Interest (net) 4371.53
(3451.73)
Profit before taxes 83843.89
(59900.09)
Taxes 23828.30
(16858.59)
Profit after taxes 60015.59
(43041.50)
a) Primary Business Segments (Previous year figures are in brackets)
6968
Titan Industries Limited
Notes forming part of the Financial Statements for the year ended 31 March 2012
Note 43 SEGMENT INFORMATION FOR THE YEAR ENDED MARCH 31, 2012 CONTD.
Note 44 SEGMENT INFORMATION FOR THE YEAR ENDED MARCH 31, 2012 CONTD.
(` lakhs)Watches Jewellery Others Corporate Total
(Unallocated)
Other InformationSegment Assets 81867.22 329918.98 24144.36 33645.36 469575.92
(69742.23) (261636.01) (18348.20) (23829.69) (373556.13)Segment Liabilities 31467.54 266055.95 7037.29 19271.84 323832.62
(31929.23) (211168.30) (6991.78) (14007.11) (264096.42)Capital expenditure 4368.18 7535.64 1837.26 511.91 14252.99
(2697.32) (1717.99) (683.26) (1268.56) (6367.13)Depreciation/ amortisation 1767.34 1606.66 862.54 253.08 4489.62
(1568.77) (1048.90) (768.78) (61.80) (3448.25)Non cash expenses other than depreciation/ amortisation 174.26 2820.57 84.33 36.67 3115.83
(–) (578.70) (–) (161.96) (740.66)
a) Primary Business Segments (Previous year figures are in brackets)
India Others TotalRevenue 867616.00 16221.84 883837.84
(639324.95) (12764.56) (652089.51)
a) Secondary geographical segmentss (Previous year figures are in brackets)
The operating facilities of the Company are commonly employed for both the domestic and export business, hence it is not possible toreport segment assets and capital expenditure by geographical segments.
Details of secondary geographical segments for individual markets outside India are not disclosed as the same do not account for more than10% of the total segment revenues or results or assets.
Total unallocable liabilities exclude2012 2011
Long-term borrowings 588.89 945.11 Foreign currency loan repayable within 12 months 542.22 542.22 6.75% debentures repayable within 12 months – 5282.60 Deferred tax liability / (asset) (Net) (377.49) 151.82
(` lakhs)
The figures of the previous year have been regrouped/recast, where necessary, to conform to the current year classification.
Note 44
For and on behalf of the Board of Directors
Bhaskar Bhat N. Sundaradevan ChairmanManaging Director Ishaat Hussain
T K BalajiS.Subramaniam K Dhanavel
Chief Financial Officer C.G.Krishnadas NairVinita Bali DirectorsV ParthasarathyR Poornalingam
A.R.Rajaram Hema RavichandarChennai, 30 April 2012 Head-Legal & Company Secretary Das Narayandas
Statement Pursuant to Section 212 of the Companies Act, 1956, relating toSubsidiary companies
1. Name of Subsidiary Titan TimeProducts Ltd Titan Properties Ltd Favre Leuba A.G.
2. Financial year of the Subsidiary 31st March 2012 31st March 2012 31st March 2012
3. Share of the Subsidiary held by
Titan Industries Limited on the above date :
a) Number of shares and face value 1,900,000 equity 335,020 equity *
shares of ` 10 each shares of ` 10 each
*Application Money pending allotment of shares - (fully paid up) (fully paid up)
` 1074.22 lakhs
b) Extent of Holding 100% 100%
4. Net aggregate amount of profit/(loss) of the
Subsidiary so far as they concern the members
of Titan Industries Limited
a) Dealt with in the accounts of Titan Industries Nil Nil Nil
Limited for the year ended 31st March 2012
b) Not dealt with in the accounts of ` 10,293,551 ` 6,500,638 ` (–) 3,034,852
Titan Industries Limited for the
year ended 31st March 2012
5. Net aggregate amount of profit/(loss) for previous
financial years of the Subsidiary since it became a
subsidiary so far as they concern the members
of Titan Industries Limited
a) Dealt with in the accounts of Nil Nil Nil
Titan Industries Limited for the
year ended 31st March 2012
b Not dealt with in the accounts of ` 42,471,714 ` 56,045,546 –
Titan Industries Limited for the
year ended 31st March 2012
For and on behalf of the Board of Directors
Bhaskar Bhat N. Sundaradevan ChairmanManaging Director Ishaat Hussain
T K BalajiS.Subramaniam K Dhanavel
Chief Financial Officer C.G.Krishnadas NairVinita Bali DirectorsV ParthasarathyR Poornalingam
A.R.Rajaram Hema RavichandarBangalore, 25 June 2012 Head-Legal & Company Secretary Das Narayandas
7170
Titan Industries Limited
Statement Pursuant to exemption granted under Section 212(8) of the CompaniesAct, 1956, relating to Subsidiary companies as at 31 March 2012
Name of Subsidiary Titan TimeProducts Ltd Titan Properties Ltd Favre Leuba A.G.
(a) Share Capital 1,90,00,000 3,350,200 –*
(b) Reserves 58,617,809 62,370,856 (3,034,852)
(c) Total Assets 135,643,510 75,185,481 104,386,780
(d) Total Liabilities 58,025,701 9,464,425 –
(e) Income 259,054,691 21,240,449 –
(f ) Profit before tax 14,592,345 9,407,638 (3,034,852)
(g) Taxes 4,298,794 2,907,000 –
(h) Profit after tax 10,293,551 6,500,638 (3,034,852)
(i) Proposed Dividend Nil Nil Nil
* Share application money pending allotment ` 1074.22 lakhs
(` in lakhs)
For and on behalf of the Board of Directors
Bhaskar Bhat N. Sundaradevan Chairman
Managing Director Ishaat HussainT K Balaji
S.Subramaniam K DhanavelChief Financial Officer C.G.Krishnadas Nair
Vinita Bali Directors
V ParthasarathyR Poornalingam
A.R.Rajaram Hema RavichandarBangalore, 25 June 2012 Head-Legal & Company Secretary Das Narayandas
AUDITORS’ REPORT
1. We have audited the attached Consolidated Balance Sheet of
TITAN INDUSTRIES LIMITED (“the Company”) and its subsidiaries
(the Company and its subsidiaries constitute “the Group”) as at
31st March, 2012, the Consolidated Statement of Profit and Loss
and the Consolidated Cash Flow Statement of the Group for
the year ended on that date, both annexed thereto. The
Consolidated Financial Statements include investments in an
associate company accounted on the equity method in
accordance with Accounting Standard 23 (Accounting for
Investments in Associates in Consolidated Financial
Statements) as notified under the Companies (Accounting
Standards) Rules, 2006. These financial statements are the
responsibility of the Company’s Management and have been
prepared on the basis of the separate financial statements and
other information regarding components. Our responsibility is
to express an opinion on these Consolidated Financial
Statements based on our audit.
2. We conducted our audit in accordance with the auditing
standards generally accepted in India. Those Standards require
that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and the disclosures in
the financial statements. An audit also includes assessing the
accounting principles used and the significant estimates made
by the Management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
3. The financial statements of an associate company in respect of
which the Group’s share of loss of Rs. 14.37 lakhs for the year
ended 31st March, 2012 is reflected in the Consolidated
Financial Statements on the basis of unaudited financial
information provided by the Management of the associate
company.
4. We report that the Consolidated Financial Statements have
been prepared by the Company in accordance with the
requirements of Accounting Standard 21 (Consolidated
Financial Statements) and Accounting Standard 23 (Accounting
for Investment in Associates in Consolidated Financial
Statements) as notified under the Companies (Accounting
Standards) Rules, 2006.
5. Based on our audit and on consideration of the separate audit
reports on the individual financial statements of the Company
and its subsidiaries and to the best of our information and
according to the explanations given to us, in our opinion, the
Consolidated Financial Statements give a true and fair view in
conformity with the accounting principles generally accepted
in India:
(i) in the case of the Consolidated Balance Sheet, of the state
of affairs of the Group as at 31st March, 2012;
(ii) in the case of the Consolidated Statement of Profit and
Loss, of the profit of the Group for the year ended on that
date and
(iii) in the case of the Consolidated Cash Flow Statement, of
the cash flows of the Group for the year ended on that date.
For DELOITTE HASKINS & SELLS
Chartered Accountants
(Registration No. 008072S)
V. Srikumar
Partner
Chennai, 30 April, 2012 (Membership No. 84494)
TO THE BOARD OF DIRECTORS OF TITAN INDUSTRIES LIMITED
7372
Titan Industries Limited
Consolidated Balance Sheet as at 31 March 2012(` lakhs)
Note As at As atParticulars No. 31-03-2012 31-03-2011
I. EQUITY AND LIABILITIES(1) Shareholders’ Funds
(a) Share capital 4.1 8877.86 4438.93 (b) Reserves and surplus 4.2 137214.04 99122.98
146091.90 103561.91(2) Non-current liabilities
(a) Long-term borrowings 5.1 588.89 945.11 (b) Deferred tax liabilities (Net) 13(b) – 208.80 (c) Other long-term liabilities 6 1145.30 278.77 (d) Long-term provisions 7 5932.72 4277.14
7666.91 5709.82 (3) Current liabilities
(a) Short-term borrowings 5.2 – 49.77 (b) Trade payables 8 175291.68 152619.04 (c) Other current liabilities 9 118860.48 96045.66 (d) Short-term provisions 10 23677.54 17863.84
317829.70 266578.31Total 471588.51 375850.04
II. ASSETS(1) Non-current assets
(a) Fixed assets(i) Tangible assets 11(a) 36304.90 27492.03 (ii) Intangible assets 11(b) 2087.13 1350.23 (iii Capital work-in-progress 2485.21 1664.28
(b) Non-current investments 12 243.87 258.24 (c) Deferred tax asset (Net) 13(b) 349.77 –(d) Long-term loans and advances 14 12817.24 12160.66
(2) Current assets(a) Inventories 15 288201.95 199811.68 (b) Trade receivables 16 16519.44 11763.00 (c) Cash and bank balances 17 96709.48 110988.54 (d) Short-term loans and advances 18 12591.76 8783.66 (e) Other current assets 19 3277.76 1577.72
417300.39 332924.60Total 471588.51 375850.04
Statement of Consolidated Profit & Loss for the year ended 31 March 2012(` lakhs)
Note Current PreviousParticulars No. Year Year
I. Revenue from operations (gross) 20 898314.55 658503.61
Less: Excise duty 13471.78 5190.01
Revenue from operations (net) 884842.77 653313.60
II. Other Income 21 9447.46 5679.71
III. Total Revenue (I +II) 894290.23 658993.31
IV. Expenses:
Cost of materials and components consumed 614008.68 434208.88
Purchase of traded goods 115088.28 84958.23
(Increase)/ decrease in inventories of finished goods, 22 (75075.15) (49865.30)
work-in-progress and traded goods
Employee benefits expense 23 39774.87 36951.42
Financial costs 32 4373.14 3454.12
Depreciation and amortization expense 4561.59 3511.17
Other expenses 24 107510.51 85453.63
Total Expenses 810241.92 598672.15
V. Profit before tax (III - IV) 84048.31 60321.16
VI. Tax expense:
(1) Current tax 23989.31 17008.06
(2) Deferred tax (558.57) (325.45)
(3) Taxes of earlier years 467.61 324.97
Total Tax 23898.35 17007.58
VII. Profit before share of loss of associate (V-VI) 60149.96 43313.58
Less: Share of loss of associate 37 14.37 1.15
VIII. Net profit 60135.59 43312.43
IX. Earnings per equity share of `1 (2011 : `10) each: 35
(1) Basic 6.77 4.88
(2) Diluted 6.77 4.88
See accompanying notes forming part of the financial statements.
In terms of our report attachedFor DELOITTE HASKINS & SELLS For and on behalf of the Board of DirectorsChartered Accountants
Bhaskar Bhat N. Sundaradevan ChairmanManaging Director Ishaat Hussain
V. Srikumar T K BalajiPartner S.Subramaniam K Dhanavel
Chief Financial Officer C.G.Krishnadas NairVinita Bali DirectorsV ParthasarathyR Poornalingam
A.R.Rajaram Hema RavichandarChennai, 30 April 2012 Head-Legal & Company Secretary Das Narayandas
See accompanying notes forming part of the financial statements.
In terms of our report attachedFor DELOITTE HASKINS & SELLS For and on behalf of the Board of DirectorsChartered Accountants
Bhaskar Bhat N. Sundaradevan ChairmanManaging Director Ishaat Hussain
V. Srikumar T K BalajiPartner S.Subramaniam K Dhanavel
Chief Financial Officer C.G.Krishnadas NairVinita Bali DirectorsV ParthasarathyR Poornalingam
A.R.Rajaram Hema RavichandarChennai, 30 April 2012 Head-Legal & Company Secretary Das Narayandas
7574
Titan Industries Limited
Consolidated Cash Flow Statement for the year ended 31 March 2012(` lakhs)
Note Current PreviousParticulars No. Year Year
A. CASH FLOW FROM OPERATING ACTIVITIES
Net profit before tax 84048.31 60321.16
Adjustments for :
– Depreciation / Amortisation 4561.59 3511.17
– Unrealised exchange difference (net) 2919.65 143.75
– Marked to Market loss 33.92 118.08
– Loss on sale/ disposal/ scrapping of fixed assets (net) 235.32 185.64
– Bad debts / advances written off 725.21 58.91
– Provision for doubtful debts/ advances (554.37) (16.73)
– Interest income (9341.29) (5584.13)
– Dividend income (0.44) (1.14)
– Interest expense 4373.14 3454.12
Operating profit before working capital changes 87001.04 62190.83
Adjustments for :
– (Increase)/decrease in sundry debtors (4917.63) (2285.29)
– (Increase)/decrease in inventories (88390.27) (65269.83)
– (Increase)/decrease in loans and advances (2921.84) (2071.62)
– Increase/(decrease) in current liabilities and provisions 50855.77 130172.07
Cash generated from operations 41627.07 122736.16
– Direct taxes paid (25681.71) (17404.54)
Net cash from operating activities 15945.36 105331.62
B. CASH FLOW FROM INVESTING ACTIVITIES
Additions to fixed assets(including capital (14777.56) (6517.35)
work in progress and advances on capital account)
Proceeds from sale of fixed assets 150.86 85.50
Purchase of investments- Others – (150.00)
Proceeds from redemption of investments – 50.13
Dividends received 0.44 1.14
Interest received 7641.25 4034.84
Net cash used in investing activities (6985.01) (2495.74)
Consolidated Cash Flow Statement (Contd.) for the year ended 31 March 2012(` lakhs)
Note Current PreviousParticulars No. Year Year
C. CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from new borrowings – 12.12
Repayment of borrowings (5857.01) (542.22)
Dividends paid (11018.54) (6615.83)
Tax on dividends paid (1800.26) (1105.88)
Interest paid (4817.98) (3432.33)
Net cash used in financing activities (23493.79) (11684.14)
Net cash flows during the year (A+B+C) (14533.44) 91151.74
Cash and bank balances (opening balance) 110988.54 19729.68
Add / ( Less) :Unrealised exchange (gain) / loss (64.39) 42.73
110924.15 19772.41
Cash and bank balances (closing balance) 96709.48 110988.54
Add / ( Less) :Unrealised exchange (gain) / loss (318.77) (64.39)
96390.71 110924.15
Increase / (decrease) in cash and bank balances (14533.44) 91151.74
See accompanying notes forming part of the financial statements.
In terms of our report attachedFor DELOITTE HASKINS & SELLS For and on behalf of the Board of DirectorsChartered Accountants
Bhaskar Bhat N. Sundaradevan ChairmanManaging Director Ishaat Hussain
V. Srikumar T K BalajiPartner S.Subramaniam K Dhanavel
Chief Financial Officer C.G.Krishnadas NairVinita Bali DirectorsV ParthasarathyR Poornalingam
A.R.Rajaram Hema RavichandarChennai, 30 April 2012 Head-Legal & Company Secretary Das Narayandas
7776
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012 Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
Note 01 BASIS OF CONSOLIDATION
The Consolidated Financial Statements relates to Titan Industries Limited (''the Company"), its subsidiary companies and an associate company.
The Company and its subsidiaries constitute the "Group". The Consolidated Financial Statements have been prepared on the following basis:
The Financial Statements of the Company and its subsidiaries have been combined on a line-by-line basis by adding together the book
values of like items of assets, liabilities, income and expenses, after fully eliminating intra-group balances, intra-group transactions and
unrealised profits or losses as per Accounting Standard (AS) 21 – Consolidated Financial Statements notified under the Companies (Accounting
Standards) Rules, 2006 (as amended). The excess of the Company’s portion of equity of the subsidiaries as at the date of its investment over
the cost of its investment is treated as Capital Reserve on Consolidation. The excess of cost to the Company of its investment over the
Company’s portion of equity as at the date of investment is treated as Goodwill on Consolidation.
Investment in associate company is accounted for using equity method as per AS 23 – "Accounting for Investments in Associates in
Consolidated Financial Statements" notified under the Companies (Accounting Standards) Rules, 2006 (as amended).
The subsidiary companies which are included in the consolidation and the Company’s holdings therein are as under:
The financial statements of the subsidiary companies and the associate company included in the consolidation are drawn up to the same
reporting date as that of the Company i.e. 31 March 2012.The financial statements of all subsidiaries included in consolidation except Favre
Leuba A.G. are audited. The figures used in consolidation of Favre Leuba A.G. and for equity accounting of the investment in the associate
company are unaudited.
The financial statements have been prepared on an accrual basis under the historical cost convention in accordance with the accounting
principles generally accepted in India and materially comply with the mandatory Accounting Standards notified by the Central Government
of India under The Companies (Accounting Standards) Rules, 2006 (as amended), and by the Institute of Chartered Accountants of India.
i) Use of estimates: The preparation of the financial statements in conformity with the generally accepted accounting principles requires
the management to make estimates and assumptions that affect the reported amount of assets and liabilities, revenues and expenses
and disclosure of contingent liabilities. Such estimates and assumptions are based on management's evaluation of relevant facts and
circumstances as on the date of financial statements. The actual outcome may diverge from these estimates.
The Associate Company which is included in the consolidation and the Company’s holdings therein are as under:
Name of the Company Country of incorporation Ownership interest Ownership interest31-03-2012 31-03-2011
Titan TimeProducts Limited India 100% 100%
Titan Properties Limited India 100% 100%
Tanishq (India) Limited(*) India – 100%
Favre Leuba A.G. (from 13 January 2012) Switzerland 100% –
(*) Amalgamated during the year (Refer note 25)
Name of the Company Country of incorporation Ownership interest Ownership interest31-03-2012 31-03-2011
TVS Wind Power Limited India 26.79% 26.79%
Name of the Company Year ended Original cost Amount of Goodwill/of investment (-) Capital Reserve in Original Cost
Favre Leuba A.G. 31st March 2012 1074.22 –
Note 02 THE PARTICULARS OF INVESTMENT MADE DURING THE YEAR IN A SUBSIDIARY COMPANY ARE AS FOLLOWS: (` lakhs)
Note 03 ACCOUNTING POLICIES
ii) Revenue recognition: Revenue from sale of goods is recognised when the substantial risks and rewards of ownership are transferred to
the buyer which generally coincides when the goods are dispatched from the factory/ stock points / or delivered to customers as per
the terms of the contract. Service revenue is recognised on rendering services.
Revenue from sale of property is recognised on percentage of completion method.
Interest income is recognised on a time proportion basis, taking into account the amount outstanding and the rate applicable.
Dividend income is recognised when the Company's right to receive the payment is established.
iii) Tangible fixed assets: All fixed assets are stated at cost less accumulated depreciation. Cost includes purchase price and all other
attributable costs of bringing the assets to working condition for intended use.
Capital work-in-progress comprises the cost of fixed assets that are not ready for their intended use at the balance sheet date.
iv) Depreciation: Depreciation has been provided on the straight line method in accordance with the Companies Act, 1956, except for the
following, which are based on the useful life of the assets estimated by the management:
Computers – @ 25% instead of 16.21%
Vehicles – @ 25% instead of 9.50%
Furniture & Fixtures –@ 20% instead of 6.33%
v) Intangible assets and amortisation: Trademarks are capitalised at acquisition cost including directly attributable cost and are amortised
over a period of 120 months from the month of acquisition. The expected pattern of economic benefits from the use of trademarks is
reviewed periodically and additional amortisation, if required, is provided.
vi) Foreign currency transactions:
a) Foreign currency transactions are recorded at the exchange rates prevailing on the date of the transaction.
Foreign exchange rate fluctuations relating to monetary assets and liabilities (including those relating to integral foreign operations)
are restated at year end rates or forward cover rates, as applicable. The net loss or gain arising on restatement/ settlement is adjusted
to the statement of profit and loss.
In respect of forward exchange contracts, the premium or discount arising at the inception of such a forward exchange contract is
amortized as expense or income over the life of the contract. Exchange differences on such contracts are recognised in the statement
of profit and loss of the reporting period in which the exchange rates change.
b) In case of integral operations, assets and liabilities (other than non-monetary items), are translated at the exchange rate prevailing
on the balance sheet date. Non-monetary items are carried at historical cost. Revenue and expenses are translated at exchange rate
prevailing on the date of transactions. Exchange difference arising out of these transactions are charged to the statement of profit
and loss account.
vii) Derivative Accounting: The Company uses derivative financial instruments to manage risks associated with gold price fluctuations
relating to certain highly probable forecasted transactions, foreign currency fluctuations relating to certain firm commitments and
foreign currency and interest rate exposures relating to foreign currency loan. The Company applies the hedge accounting principles
set out in Accounting Standard (AS) 30 - Financial Instruments: Recognition and Measurement and has designated derivative financial
instruments taken for gold price fluctuations as 'cash flow' hedges relating to highly probable forecasted transactions. All such derivative
financial instruments are supported by an underlying transaction and are not for trading or speculative purposes.
The use of derivative financial instruments is governed by the Company's policies approved by the board of directors, which provide
written principles on the use of such instruments consistent with the Company's risk management strategy.
Hedging instruments are initially measured at fair value, and are remeasured at subsequent reporting dates. Changes in the fair value of
these derivatives that are designated and effective as hedges of future cash flows are recognised directly in hedging reserve and the
ineffective portion is recognised immediately in the statement of profit and loss.
Note 03 ACCOUNTING POLICIES (Contd.)
7978
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012 Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
Note 03 ACCOUNTING POLICIES (Contd.)
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, or exercised, or no longer qualifies for
hedge accounting. For forecasted transactions, any cumulative gain or loss on the hedging instrument recognized in hedging reserve
is retained until the forecast transaction occurs upon which it is recognized in the statement of profit and loss. If a hedged transaction
is no longer expected to occur, the net cumulative gain or loss accumulated in hedging reserve is recognized immediately to the
statement of profit and loss.
Changes in the fair value of derivative financial instruments that have not been designated as hedging instruments are recognised in
the statement of profit and loss as they arise.
viii) Investments: All long term investments are valued at cost. Provision for diminution in value is made to recognise any decline, other
than temporary, in the value of investments.
ix) Transfer to debenture redemption reserve is made pro-rata over the life of the debentures in terms of the requirements of the Companies
Act, 1956.
x) Inventories: Inventories are valued at lower of cost and net realisable value. The cost of various categories of inventory is determined as
follows:
a) Gold is valued on first-in-first-out basis.
b) Consumable stores, loose tools, raw materials and components are valued on a moving weighted average rate.
c) Work-in-progress and manufactured goods are valued on full absorption cost method based on the average cost of production.
d) Traded goods are valued on a moving weighted average rate/ cost of purchases.
xi) Product warranty expenses: Product warranty costs are determined based on past experience and provided for in the year of sale.
xii) Employee benefits:
Short term employee benefits
All short term employee benefits such as salaries, wages, bonus, special awards, medical benefits which fall due within 12 months of the
period in which the employee renders the related services which entitles him to avail such benefits and non-accumulating compensated
absences are recognised on an undiscounted basis and charged to the statement of profit and loss.
Defined Contribution plan
Company's contributions to the Superannuation Fund which is managed by a Trust and Pension Fund administered by Regional Provident
Fund Commissioner are debited to the statement of profit and loss on an accrual basis.
Contribution to the Company's Provident Fund Trust is made at predetermined rates and debited to the statement of profit and loss
account.
Contribution to Provident Fund and Pension Fund (of a subsidiary) are made at predetermined rates to the Regional Provident Fund
Commissioner and debited to the statement of profit and loss account on an accrual basis.
Defined Benefit Plan:
Contribution to the Company’s Gratuity Trust, liability towards pension of retired managing director and provision towards leave salary
benefit is provided on the basis of an actuarial valuation using the projected unit credit method and is debited to statement of profit
and loss account on an accrual basis. Actuarial gains and losses arising during the year are recognised in the statement of profit and loss
account.
xiii) Taxes on Income: Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the
provisions of the Income-tax Act, 1961.
Deferred tax is recognised on timing differences, being the difference between taxable income and accounting income that originate
in one period and are capable of reversal in one or more subsequent periods.
xiv) Segment accounting: Segments are identified based on the types of products and the internal organisation and management structure.
The Company has identified business segment as its primary reporting segment with secondary information reported geographically.
Note 03 ACCOUNTING POLICIES (Contd.)
The Group’s primary segments consist of Watches, Jewellery and Others, where ‘Others’ include Eye wear, Precision Engineering, Machine
Building and Clocks.
Segment assets and liabilities include all operating assets and liabilities. Segment results include all related income and expenditure.
Corporate (unallocated) represents other income and expenses which relate to the enterprise as a whole and are not allocated to
segments.
xv) Impairment of assets: Consideration is given at each Balance Sheet date to determine whether there is any indication of impairment of
the carrying amount of the assets/ cash generating units. If any indication exists, an impairment loss is recognized when the carrying
amount exceeds the greater of net selling price and value in use.
xvi) Provisions and Contingencies: A provision is recognised when the Company has a present obligation as a result of past events and it is
probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made.
Provisions are not discounted to present value and are determined based on best estimate required to settle the obligation at the
Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent
Liabilities are not recognised but are disclosed in the notes.
Contingent Assets are neither recognised nor disclosed in the financial statements.
2012 2011No. of shares Amount No. of shares Amount
in lakhs `lakhs in lakhs `lakhs
a) Authorised share capital
Equity share of `1 ( 2011: `10) each 12000.00 12000.00 800.00 8000.00
Redeemable cumulative preference shares of `100 each 40.00 4000.00 40.00 4000.00
b) Issued, subscribed and fully paid up share capital
Equity share of `1 ( 2011: `10) each fully paid up 8877.86 8877.86 443.89 4438.93
c) Rights of shareholders :
The Company has only one class of equity shareholders. Each holder of equity shares is entitled to one vote per share. The Company
declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to approval by the shareholders
at the ensuing Annual General Meeting.
d) Reconciliation of the shares outstanding at the beginning and at the end of the year
Note 4.1 SHARE CAPITAL
2012 2011No. lakhs `lakhs No. lakhs `lakhs
Equity sharesAt the beginning of the year 443.89 4438.93 443.89 4438.93
Add: Sub-division of shares 3995.04 – – –
Add : Issue of bonus shares 4438.93 4438.93 – –
At the end of the year 8877.86 8877.86 443.89 4438.93
8180
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012 Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
2012 2011
a) Capital reserve 13.28 13.28b) Capital reserve on consolidation
As per last Balance sheet 65.48 65.48 Less : On amalgamation 30.06 –
35.42 65.48c) Capital redemption reserve
As per last Balance sheet 10.00 10.00 Add : On amalgamation (Refer Note 25) 64.38 –
74.38 10.00 d) Share premium Account 13888.27 13888.27 e) Debenture redemption Reserve
As per last Balance Sheet 2597.00 2069.00 Add : Transfer from statement of profit and loss – 528.00 Less: Transfer to general reserve 2597.00 –
– 2597.00f ) Hedging Reserve
As per last Balance Sheet 1.62 45.90 Add : Effects of variation in commodity prices on hedging 0.57 1.62instruments outstanding at the end of the yearLess : Transferred to statement of profit and loss 1.62 45.90
0.57 1.62g) General Reserve
As per last balance sheet 38337.34 24691.34 Add : Transfer from debenture redemption reserve 2597.00 –Add : On amalgamation (Refer Note 25) 399.59 –Less : Utilised during the year for issuing bonus shares 4438.93 –Add : Transfer from statement of profit and loss 21631.00 13646.00
58526.00 38337.34
Note 4.2 RESERVES AND SURPLUS (` lakhs)
2012 2011
h) Surplus in the statement of profit and lossOpening Balance 44209.99 27969.15
Add : Profit for the year 60135.59 43312.43 Add : On amalgamation 18.17 –
104363.75 71281.58 Less:Transfer to debenture redemption reserve – 528.00 Proposed dividend on equity shares 15536.26 11097.33 Tax on dividends 2520.37 1800.26 Transfer to general reserve 21631.00 13646.00
Net surplus in statement of profit and loss 64676.12 44209.99 Reserves and surplus 137214.04 99122.98
Note 4.2 RESERVES AND SURPLUS (Contd.) (` lakhs)Note 4.1 SHARE CAPITAL (Contd.)
e) Shareholders holding more than 5% shares in the Company (No. in lakhs)2012 2011
Name No. of % total No. of % totalshares held holding shares held holding
Tamilnadu Industrial Development Corporation Limited 2474.77 27.88 123.74 27.88
Tata GroupTata Sons Limited 963.45 10.85 47.48 10.70
Kalimati Investment Company Limited 775.56 8.74 38.78 8.74
Tata Investment Corporation Ltd 172.26 1.94 8.61 1.94
Tata Chemicals Ltd 138.26 1.56 6.91 1.56
Tata Global Beverages Ltd (formerly Tata Tea Ltd) 92.48 1.04 4.62 1.04
Ewart Investments Ltd 49.64 0.56 2.48 0.56
Tata International Ltd 25.60 0.29 1.97 0.44
Piem Hotels Ltd 18.06 0.20 0.90 0.20
Total - Tata Group 2235.31 25.18 111.75 25.18
Jhunjhunwala Rakesh Radheshyam 666.29 7.51 33.05 7.45
2012 2011
Loans repayable on demand
– from banks - Secured* – 49.77
– 49.77
* Cash credit account secured by hypothecation of inventories, spares and book debts both present and future.
Note 5.2 SHORT-TERM BORROWINGS (` lakhs)
2012 2011
Provision for retiring gratuities (Refer Note 30) 115.01 82.35
Provision for Leave salaries (Refer Note 30) 5481.60 3883.07
Provision for Pension (Refer Note 30) 336.11 311.72
5932.72 4277.14
Note 07 LONG-TERM PROVISIONS (` lakhs)
2012 2011
Payables - capital goods 1145.30 278.77
1145.30 278.77
Note 06 OTHER LONG-TERM LIABILITIES (` lakhs)
2012 2011
Term loans
From banks - Secured
Foreign Currency loan 588.89 945.11
588.89 945.11
An amount of ` 542.22 lakhs (2011: ` 542.22 lakhs) of Foreign currency loan which is repayable within 12 months have been grouped under
other current liabilities.
The above foreign currency loan aggregating ` 1131.11 lakhs (2011: ` 1487.33 lakhs) is secured by a first charge over the Company's present
and future fixed (movable and immovable) assets and is repayable in 9 semi-annual installments starting February 2010.
Note 5.1 LONG-TERM BORROWINGS (` lakhs)
8382
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012 Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
2012 2011
i) Principal amounts unpaid 238.48 86.54
Interest due on above – –
238.48 86.54
Note 08
(` lakhs)
ii) No interest payments have been made during the year.
iii) The above information regarding dues to Micro Enterprises and Small Enterprises has been determined to the extent such parties havebeen identified on the basis of information available with the Company. This has been relied upon by the auditors.
2012 2011
a) Short-term provisionsProposed Dividend on equity shares 15536.26 11097.33 Tax on dividends 2520.37 1800.26 Provision for gratuity (Refer Note 30) 895.58 1871.84 Provision for leave salaries (Refer Note 30) 744.84 499.36 Others {Refer note (c) below} 3980.49 2595.05 Total 23677.54 17863.84
Note 10 (` lakhs)
2012 2011
Advances from customers {Refer Note (a) below} 95074.62 66,896.61 Interest accrued and not due on borrowings – 327.79 Unearned revenue 21.57 139.21 Unclaimed dividends 238.07 159.28 Unclaimed matured fixed deposits 4.55 5.95 Foreign currency loan repayable within 12 months {Refer Note 5.1} 542.22 542.22 6.75% debentures repayable within 12 months {Refer note (b) below} – 5265.02 Statutory dues 4096.55 3442.23 Deferred income through group transaction – 449.96 Other Liabilities - Others 18882.90 18817.39
118860.48 96045.66
a) Advances from customers include advances received of ` 85663.80 lakhs (2011: ` 58779.77 lakhs) towards sale of jewellery productsunder various sale initiatives / retail customer programmes.
b) The 6.75% debentures redeemable at par at the end of five years from the dates of allotment on May 12, 2006 and June 09, 2006 and securedby way of legal mortgage on the immovable properties and plant and machinery situated at Hosur were redeemed during the year.
Note 09 OTHER CURRENT LIABILITIES (` lakhs)
b) The Board of Directors, in their meeting on April 30, 2012, proposed a dividend of `1.75 per equity share. The proposal is subject to the
approval of shareholders at the Annual General Meeting to be held on 26 July, 2012, and if approved, would result in a cash outflow of
approximately `18056.63 lakhs inclusive of corporate dividend tax of `2520.37 lakhs.
Dividend recognized as distributions to equity shareholders for the year ended March 31, 2011 was `25 per share.
c) Others include
(i) Provision for warranty - `373.95 lakhs (2011: `264.88 lakhs).
The Company gives warranty on all products except jewellery, undertaking to repair or replace the items that fail to perform
satisfactorily during the warranty period. Warranty provisions are made for expected future outflows and determined based on
past experience. No reimbursements are expected. Provision made and utilised/reversed during the year is `373.95 lakhs (2011: `264.88 lakhs) and `264.88 lakhs (2011: `228.48 lakhs) respectively.
(ii) Provision for Customer Loyalty programmes - `3606.54 lakhs (2011: `2330.17 lakhs)
The Company has a scheme of reward points on purchase of certain products by customers which can be redeemed at the time
of future purchases. Provision is made based on past experience. Additional provision made and utilised/reversed during the year
is `3787.51 lakhs (2011: `3311.74 lakhs) and `2511.14 lakhs (2011: `1969.01 lakhs) respectively.
Note 10 (Contd.)
Note 11
a) Tangible AssetsGross Block
Trade Payables include amounts due to micro enterprises and small enterprises as under:
(` lakhs)Gross Block
Particulars Cost as at Additions Deductions Cost as atApril 1, 2011 March 31, 2012
Land -freehold 227.19 588.41 0.16 815.44
Land - leasehold 541.96 949.28 – 1491.24
Buildings 6979.71 547.44 30.48 7496.67
Plant, machinery and equipment 46052.87 5691.82 1082.30 50662.39
Furniture, fixtures and equipment 6631.05 4947.99 424.18 11154.86
Office equipment 810.62 510.70 40.14 1281.18
Vehicles 980.27 271.83 87.79 1164.31
Total 62223.67 13507.47 1665.05 74066.09 Previous Year 57412.66 5845.78 1034.77 62223.67
Tangible Assets - Depreciation and net block (` lakhs)Depreciation Net Block
Particulars Upto For the year Deductions As at As at As atMarch 31, 2011 March 31, 2012 March 31, 2012 March 31, 2011
Land -freehold – – – 815.44 227.19
Land - leasehold 9.68 0.51 – 10.19 1481.05 532.28
Buildings 2206.09 201.59 6.04 2401.64 5095.03 4773.62
Plant, machinery and equipment 28175.44 2029.98 826.32 29379.10 21283.29 17877.43
Furniture, fixtures and equipment 3737.53 1776.99 350.31 5164.21 5990.65 2893.52
Office equipment 150.03 71.05 17.36 203.72 1077.46 660.59
Vehicles 452.87 228.30 78.84 602.33 561.98 527.40
Total 34731.64 4308.42 1278.87 37761.19 36304.90 27492.03
Previous Year 32237.27 3258.00 763.63 34731.64 27492.03
8584
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012 Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
Note 11 (Contd.)
b) Intangible assets
2012 2011
Opening Gross Block 6327.11 6327.11
Additions during the year 990.07 –
Deductions during the year – –
Closing Gross Block 7317.18 6327.11
Opening Amortisation 4976.88 4723.71
Amortisation for the year 253.17 253.17
Total Amortisation 5230.05 4976.88
Net Block 2087.13 1350.23
(` lakhs)a) The Company has given an undertaking not to sell or encumber in any manner its investments in TVS Wind Power Limited in accordance
with the Equity Participation agreement.
b) A Petition has been filed by the Company’s subsidiary Titan Properties Limited as the Transferor Company, seeking sanction to the
Scheme of Amalgamation with the Company on the appointed date i.e. 1 April 2011. No shares of the Company are to be issued
pursuant to the Scheme. Based on the application made under section 391 of the Companies Act, 1956, the Chennai High Court having
jurisdiction over the Transferor Company has granted dispensation of the meetings of shareholders and creditors of the Transferor
Company. The final order sanctioning the said scheme of Amalgamation as aforesaid is awaited.
Note 12 NON-CURRENT INVESTMENTS (Contd.)
2011 Tax effect 2012for the year
Deferred Tax (Liability)Fixed assets (2447.83) 18.66 (2429.17)
Sub Total (2447.83) 18.66 (2429.17)Deferred Tax AssetProvision for doubtful debts/advances 241.89 (179.02) 62.87
Employee benefits 1378.66 608.32 1986.98
Others 618.48 110.61 729.09
Sub Total 2239.03 539.91 2778.94 Net deferred tax (liability)/ asset (208.80) 558.57 349.77
Note 13
a) Deferred tax asset/liability (` lakhs)
2012 2011
b) Classified on company wise basis:i) Deferred tax asset 377.49 –
ii) Deferred tax liability (27.72) (208.80)
Net deferred tax asset/ (liability) 349.77 (208.80)
(` lakhs)
2012 2011
Trade investments - unquotedIn associate companiesCarrying amount of investment in TVS Wind Power Limited {Refer Note (a) below and note 37} 134.48 148.85
Non-Trade investments - quoted 100 (2011 : 100) fully paid equity shares of `10 each in Timex Watches Limited 0.01 0.01
1,000 (2011 : 1,000) fully paid equity shares of `10 each 0.10 0.10
in National Radio Electronics Company Limited
2,025 (2011 : 2,025) fully paid equity shares of `10 each in Tata Steel Limited 4.62 4.62
6000 (2011 : 6000) fully paid equity shares of `1 each in Tata Global Beverages Limited 2.34 2.34
560 (2011 : 560) fully paid equity shares of `10 each in Tata Chemicals Limited 1.40 1.40
300 (2011 : 300) fully paid equity shares of `10 each in Trent Limited 0.92 0.92
100 (2011 : 100) fully paid equity shares of `10 each in Titan Alloys Limited 0.02 0.02
100 (2011: 100) fully paid equity shares of `10 each in Titan Foods and Fashions Limited 0.01 0.01
100 (2011 : 100) fully paid equity shares of `10 each in Titan Biotech Limited 0.02 0.02
100 (2011 : 100) fully paid equity shares of `10 each in Titan Securities Limited 0.01 0.01
9.45 9.45
Less : Provision for diminution 0.06 0.06
9.39 9.39
Non-Trade investments -Unquoted 5,25,000 lakh (2011: 5,25,000 lakh) fully paid equity shares 100.00 100.00
of `10 each in Innoviti Embedded Solutions Private Limited
243.87 258.24
Aggregate amount of quoted investments 9.39 9.39
Aggregate amount of unquoted investments 234.48 248.85
Market value of quoted investments 21.63 24.10
Note 12 NON-CURRENT INVESTMENTS (` lakhs)
2012 2011
Capital advances 600.90 273.21
Less: Provision for doubtful advances 2.07 –
598.83 273.21
Other advances:
– Security deposits 7013.40 5049.34
– Employee loans 1032.83 871.00
– Other deposits 523.87 748.36
– Tax payments, net of provisions 3648.31 5218.75
12817.24 12160.66
Note 14 LONG TERM LOANS AND ADVANCES (Unsecured and considered good unless otherwise stated) (` lakhs)
8786
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012 Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
2012 2011
Raw materials 49776.62 36244.71
Raw materials - in Transit 210.47 532.70
Work-in-progress 12118.14 8716.83
Contract work-in-progress 93.14 102.45
Finished goods 161954.50 115990.57
Finished goods - In transit 57.70 –
Stock in trade 62924.11 37262.59
Store and spares 552.92 471.39
Loose tools 514.35 490.44
288201.95 199811.68
Note 15 INVENTORIES (` lakhs)
2012 2011
Cash and cash equivalentsa) Balance with banks* 8119.05 7369.11
b) Cheques, drafts on hand 881.36 385.42
c) Cash in hand 938.42 519.34
d) Short term deposits with banks 12320.00 1050.00
22258.83 9323.87
Other bank balancesa) Earmarked balances with banks
Unclaimed dividend 236.67 157.89
Unclaimed debenture interest 15.75 3.55
Share application money received for allotment of rights shares and due for refund 3.23 3.23
b) Fixed Deposits held as margin money against bank guarantee 1100.00 –
c) Short term deposits with banks with more than three months maturity 73095.00 101500.00
74450.65 101664.67
96709.48 110988.54
* Includes Funds in transit - ` 2058.14 lakhs (2011: ` 1555.28 lakhs)
Note 17 CASH AND BANK BALANCES (` lakhs)
2012 2011
Trade receivables outstanding for a period exceeding
six months from the date they were due for payment
Considered good 367.70 296.09
Considered doubtful 189.23 745.54
556.93 1041.63
Less : Provision for doubtful debts 189.23 745.54
367.70 296.09
Other Trade Receivables
Considered good 16151.74 11466.91
16519.44 11763.00
Note 16 TRADE RECEIVABLES (Unsecured) (` lakhs)
2012 2011
Advances recoverable in cash or kind or for value to be receivedAdvances to vendors 2005.29 2676.89 Security Deposits 1471.93 1838.86 Prepaid expenses 1174.72 802.08 Others 4118.82 1818.46
8770.76 7136.29 Considered doubtful 2226.54 2226.67
10997.30 9362.96 Less : Provision for doubtful loans and advances 2226.54 2226.67
8770.76 7136.29 Tax payments, net of provisions 3034.88 239.65 Balance with customs and excise authorities 786.12 1407.72
12591.76 8783.66
Note 18 SHORT-TERM LOANS AND ADVANCES (Unsecured and considered good, unless otherwise stated) (` lakhs)
2012 2011
Interest accrued on deposits 3277.76 1577.72
3277.76 1577.72
Note 19 OTHER CURRENT ASSETS (Unsecured and considered good, unless otherwise stated) (` lakhs)
Current year Previous year
Sale of productsManufactured goods
Watches 111798.78 94278.74 Jewellery 583715.87 428433.12 Others 7215.27 6464.95
702729.92 529176.81Traded goods
Watches 40593.66 29575.08 Jewellery 111580.13 68185.01 Others 32330.89 24594.69
184504.68 122354.78 Total - Sale of products (a) 887234.60 651531.59Sale of tools and components (b) 1171.11 1246.12 Income from services provided (c) 289.91 269.41 Other operating revenueSale of precious / semi-precious stones 6547.24 3230.80 Sale of gold 2170.73 1168.05 Scrap sales 724.09 520.73 Others 176.87 536.91 Total - Other operating revenue (d) 9618.93 5456.49 Revenue from operations (gross) (a+b+c+d) 898314.55 658503.61Less : Excise duty 13471.78 5190.01 Revenue from operations (Net) 884842.77 653313.60
Note 20 REVENUE FROM OPERATIONS (` lakhs)
8988
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012 Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
Current year Previous year
Interest from staff loans, vendor advances and bank deposits 9341.29 5584.13
Dividends on long-term, Non-trade investments - Others 0.44 1.14
Miscellaneous Income 89.82 73.92
Other non-operating income 15.91 20.52
9447.46 5679.71
Note 21 OTHER INCOME (` lakhs)
Current year Previous year
Closing stockFinished goods 162012.20 115990.57
Work-in-progress 12118.14 8716.83
Stock-in-trade 62924.11 37262.59
Contract work-in-progress 93.14 102.45
237147.59 162072.44
Opening stockFinished goods 115990.57 80846.33
Work-in-progress 8716.83 10903.73
Stock-in-trade 37262.59 20139.52
Contract work-in-progress 102.45 317.56
162072.44 112207.14
(Increase) / decrease in inventory (75075.15) (49865.30)
Note 22 (INCREASE)/ DECREASE IN INVENTORIES OF FINISHED GOODS, WORK-IN-PROGRESS AND TRADED GOODS (` lakhs)
Current year Previous year
Salaries, wages and bonus 34078.84 31506.66
Company's contribution to provident and other funds (Refer Note 30) 1503.83 1228.73
Welfare expenses 3269.26 2330.62
Gratuity (Refer Note 30) 922.94 1885.41
39774.87 36951.42
Note 23 EMPLOYEE BENEFITS EXPENSE (` lakhs)
Current year Previous year
Loose tools, stores and spare parts consumed 8097.60 8439.65 Agency labour 3351.16 2783.53 Power and fuel 2551.74 2163.19 Repairs to buildings 373.00 196.21 Repairs to plant and machinery 1044.54 890.67 Repairs and maintenance-Others 45.12 42.32 Advertising 38142.33 30326.93 Selling and distribution expenses 8194.45 7275.80 Insurance 488.33 363.33 Rent 11584.80 7482.38 Rates and taxes 11831.07 9123.27 Travel 2150.67 1906.65 Bad debts/deposits/advances written off 725.21 58.91 Provision for doubtful debts / advances 166.27 34.51 Less : Provision for doubtful debts of earlier years written back 720.64 51.24
(554.37) (16.73)Irrecoverable loans and advances written off – 2952.60 Less : Provision for loans and advances created earlier years – 2952.60
– –Loss on sale / disposal / scrapping of fixed assets (net) 235.32 185.64 Gold price hedging costs (net) 305.90 114.34 General Expenses* 18907.89 13910.99 Directors Fees 15.82 15.17 Directors commission 290.00 210.00 Expenses capitalised (270.07) (18.62)
107510.51 85453.63
* Includes exchange gain (net) of ` 196.16 lakhs (2011: ` 265.45 lakhs)
Note 24 OTHER EXPENSES (` lakhs)
Pursuant to the Scheme of amalgamation of Tanishq (India) Limited (TQL) (wholly owned subsidiary of the Company carrying on trading
activities) with the Company as sanctioned by the High Court of Karnataka, all assets and liabilities have been transferred to and vested in
the Company retrospectively with effect from April 1, 2010.
The amalgamation has been accounted for under the "pooling of interests" method as prescribed by Accounting Standard (AS) 14 -
Accounting for Amalgamations notified by the Central Government of India under the Companies (Accounting Standards) Rules, 2006.
Accordingly, the assets, liabilities and reserves have been recorded at their respective book values in the accounts of the Company.
Note 25
The assets and liabilities which have merged with the parent company are as under:
Cash and bank balances 832.18
Loans and advances 26.70
Investments 15.47
Current liabilities (0.57)
873.78
(` lakhs)
9190
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012 Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
Contingent Liabilities not provided for - ` 15845.16 lakhs (2011: ` 5805.51 lakhs) comprising of the following:
Sales Tax - `543.25 lakhs (2011: `412.72 lakhs)
(relating to the applicability of rate of tax, computation of tax liability, submission of certain statutory forms)
Customs Duty - `316.94 lakhs (2011: `316.94 lakhs)
(relating to compliance with the terms of notification, export obligations)
Excise Duty - `10482.86 lakhs (2011: `3331.58 lakhs)
(relating to denial of exemption by amending the earlier notification, computation of the assessable value, denial of input credit on service
tax and excise duty on jewellery)
Income Tax - `4027.21 lakhs (2011: `1289.78 lakhs)
(relating to disallowance of deductions claimed)
Others - `474.90 lakhs (2011: `454.49 lakhs)
(relating to miscellaneous claims)
The above amounts are based on the notice of demand or the Assessment Orders or notification by the relevant authorities, as the case may
be, and the Company is contesting these claims with the respective authorities. Outflows, if any, arising out of these claims would depend
on the outcome of the decisions of the appellate authorities and the Company's rights for future appeals before the judiciary. No
reimbursements are expected.
ii) Contributions are made to the Company's Employees Provident Fund Trust at predetermined rates in accordance with the Fund rules. The
interest rate payable by the Trust to the beneficiaries is as notified by the Government. The Company has an obligation to make good the
shortfall, if any, between the return from the investments of the Trust and the notified interest rate and recognizes such shortfall as an
expense. Based on the actuarial valuation, there is no shortfall in the interest payable by the Trust to the beneficiaries as on the balance sheet
date.
b. Defined Benefit Plans(i) Funded The Company makes annual contributions to The Titan Industries Gratuity Fund. The scheme provides for lump sum payment to vested
employees at retirement, death while in employment, or on termination of employment as per the Company's Gratuity Scheme. Vesting
occurs upon completion of five years of service.
The gratuity benefit of the subsidiary is not funded.
The following table sets out the funded status and amounts recognised in the Titan Group's financial statements as at 31 March 2012for Gratuity.
Note 26
Estimated amount of contracts remaining to be executed on capital account and not provided for is ` 3355.21 lakhs (2011: ` 3578.34 lakhs).
Note 27
The Company had received show cause notice from the Excise authorities for ` 2016.93 lakhs without quantifying interest and penalty,
relating to the methodology of allocation and apportionment of input service tax credit. The Company has been legally advised that the
notice is not sustainable.
Note 28
a. Non-fund based facilities availed of ` 21609.09 lakhs (2011: ` 25807.41 lakhs) from banks are secured by a first charge by way of
hypothecation of current assets including book debts and inventories, both present and future. The security covered rank pari passu with
the security for the cash credit facility.
b. Estimated amount of contracts remaining to be executed on revenue account and not provided for is ` 9136.79 lakhs(2011: ` 5399.16
lakhs).
Note 29 Other Commitments
The reserve and surplus which have been added to the parent company are as under:
Capital redemption reserve 64.38
General reserve 399.59
Surplus in statement of profit and loss 29.84
493.81
Note 25 (Contd.) (` lakhs)
Current year Previous year
Superannuation Fund 317.62 268.00 Employee Pension Fund (EPF) 343.19 273.56 Provident Fund 843.02 687.17
1503.83 1228.73
a. Defined Contribution Plans
i) The contributions recognized in the statement of profit and loss during the year are as under:
Note 30 EMPLOYEE BENEFITS
(` lakhs)
(` lakhs)
Current year Previous year
Funded Unfunded Funded UnfundedI. Net Asset / (Liability) recognized in the balance sheet 1. Present value of funded obligations 8518.30 118.57 7292.47 87.65
2. Fair Value of Plan Assets (7626.28) – (5425.93) –
3. (Deficit) / surplus (892.02) (118.57) (1866.54) (87.65)
4. Net Asset / Liability
– Assets
– Liabilities (current) 892.02 3.56 1866.54 5.30
– Liabilities (non-current) – 115.01 – 82.35
II. Expense recognized in the statement of profit and loss1. Current Service Cost 540.50 5.31 373.63 2.58
2. Interest Cost 643.32 7.63 452.67 5.90
3. Expected Return on Plan Assets (419.80) – (327.18) –
4. Actuarial Losses/ (Gains) 128.00 17.98 1364.12 2.60
5. Past Service Cost – – 3.30 7.79
Total expenses recognised under the head "Gratuity' (Refer note 23) 892.02 30.92 1866.54 18.87
9392
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012 Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
The following table sets out the funded status and amounts recognised in the Titan Group's financial statements as at 31 March 2012for Gratuity (Contd.).
Note 30 EMPLOYEE BENEFITS (Contd.) Note 30 EMPLOYEE BENEFITS (Contd.)
(` lakhs)
Current year Previous year
Funded Unfunded Funded UnfundedIII. Change in present value of obligation 1. Present value of Defined Benefit Obligation
at the beginning of the year 7292.47 87.65 5126.23 68.78
2. Current Service Cost 540.50 5.31 373.63 2.58
3. Interest Cost 643.32 7.63 452.67 5.90
4. Actuarial Losses/ (Gains) 156.22 17.98 1392.32 2.60
5. Past Service Cost – – 3.30 7.79
6. Benefits Paid (114.21) – (55.68) –
7. Present value of Defined Benefit Obligation at the end of the year 8518.30 118.57 7292.47 87.65
IV. Change in fair value of Plan assets 1. Fair value of plan assets at the beginning of the year 5425.93 – 4191.14 –
2. Expected Return on Plan assets 419.80 – 327.19 –
3. Actuarial (Losses)/ Gains 28.22 – 28.20 –
4. Assets distributed on settlement – – – –
5. Contributions by employer 1866.54 – 935.08 –
6. Benefits Paid (114.21) – (55.68) –
7 Fair value of plan assets at the end of the year 7626.28 – 5425.93 –
Actual Return on Plan assets 448.02 – 355.39 –
V. The major categories of Plan Assets as a percentage of total Plan Assets
1. Government of India Securities 51% 45%
2. Corporate bonds 45% 51%
3. Others 4% 4%
(` lakhs)2012 2011 2010 2009 2008
Defined Benefit Obligation 8636.87 7380.12 5195.01 4105.61 3434.40
Plan Assets 7626.28 5425.93 4191.14 3569.57 2877.94
Surplus / (Deficit) (1010.59) (1954.19) (1003.87) (536.04) (556.46)
Experience adjustments on Plan Liabilities 372.87 504.82 182.86 232.18 185.14
Experience adjustments on Plan Assets 28.22 28.20 9.78 82.95 4.29
VI. Experience Adjustments
VII. Principal actuarial assumptions Discount Rate 8.55% p.a 8.35% p.a
Expected Rate of Return on Plan Assets 7.50% p.a 7.50% p.a
VIII. The employees are assumed to retire at the age of 58 or 60 years.
IX. The mortality rates considered are as per the published rates in the LIC (1994-96) mortality tables.
Expected rate of return on plan assets is based on average yield on investments. The Company is expected to contribute ` 800.00 lakhs to the gratuity
fund for the year ending 31 March 2013.
(ii) Unfunded
The defined benefit obligations which are provided for but not funded are as under:
The discount rate is based on the prevailing market yields of Indian Government securities as at the balance sheet date for the estimated term of the
obligations.
The estimate of future salary increases considered, takes into account the inflation, seniority, promotion, increments and other relevant factors.
Liability as on Liability as onMarch 31, 2012 March 31, 2012
Compensated absences / Leave salary
Non-current 5481.60 3883.07
Current 744.84 499.36
6226.44 4382.43
Pension - Non-current 336.11 311.72
(` lakhs)
Auditors remuneration comprises of fees for audit of statutory accounts ` 111.25 lakhs (2011: ` 93.00 lakhs), taxation matters ` 33.84 lakhs
(2011: ` 28.36 lakhs), audit of consolidated accounts ` 8.40 lakhs (2011: ` 7.00 lakhs), other services ` 27.88 lakhs (2011: ` 21.90 lakhs) and
reimbursement of levies and expenses ` 17.53 lakhs (2011: ` 19.75 lakhs).
Note 31
a) Gold futures/forwards contracts outstanding as at the year end - 978 kgs, ` 27890.60 lakhs (2011: 26 Kgs, ` 547.51 lakhs)
b) The Company has an outstanding swap to hedge its foreign currency and interest rate exposures relating to foreign currency loan of US
Dollars 2.22 million (2011: US Dollars 3.33 million) equivalent to ` 1131.11 lakhs (2011: ` 1487.33 lakhs).
The Company has Nil forward exchange contracts outstanding for US Dollars Nil equivalent to ` Nil (2011: 12 forward exchange
contracts for US Dollars 1.75 million; equivalent to ` 779.68 lakhs), Nil forward exchange contract for Euros Nil equivalent to ` Nil
(2011: 1 forward exchange contract for Euros 0.09 million equivalent to ` 53.98 lakhs) and Nil forward exchange contracts for HKD Nil
equivalent to ` Nil (2011: 3 forward contracts for HKD 1.8 million equivalent to ` 102.98 lakhs) to hedge foreign currency risk of firm
commitment of sales. Further, the Company also has 3 forward exchange contracts for US Dollars 8.70 million equivalent to ` 4457.60
lakhs (2011: 16 forward exchange contracts for US Dollars 22.83 million equivalent to ` 10185.30 lakhs), 3 forward exchange contracts
for HKD 60 million equivalent to ` 3969.50 lakhs(2011: Nil), Nil forward exchange contract for in Swiss Francs Nil equivalent to ` Nil
(2011: 1 forward exchange contract for in Swiss Francs 0.13 million equivalent to ` 61.41 lakhs) and six foreign exchange contracts for
Japanese Yen 143.40 million equivalent to ` 918.18 lakhs (2011: Nil) for firm commitment of purchases.
Marked to Market loss of ` 33.92 lakhs (2011 : ̀ 118.08 lakhs) has been recognized in the statement of profit and loss on these outstanding
contracts.
Note 33
Finance costs include gold on lease charges of ` 3834.04 lakhs ( 2011 : ` 2630.76 lakhs) and interest on income tax of ` 117.95 lakhs ( 2011:
` 68.23 lakhs).
Note 32 RATES AND TAXES INCLUDE THE FOLLOWING
9594
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012 Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
c) The foreign currency exposures that are not hedged by a derivative instrument or otherwise as at March 31, 2012 are given below:
i) Amounts receivable in foreign currency as at March 31, 2012 (Previous year figures are in brackets)
ii) Amounts payable in foreign currency as at March 31, 2012 (Previous year figures are in brackets)
Note 33 (Contd.)
Nature of receivables ` Foreign currency
Export of goodsUSD 3099.35 60.92
(2102.89) (47.89)
GBP 15.86 0.19
(18.45) (0.26)
HKD 281.90 43.04
(176.24) (30.77)
EURO 75.38 1.11
(158.22) (2.50)
Nature of payables ` Foreign currency
Import of goods and services
USD 672.42 13.21
(519.79) (11.65)
EURO 65.90 0.97
(73.41) (1.16)
HKD 267.32 40.75
(376.89) (65.73)
CHF 23.90 0.42
(121.08) (2.48)
JPY 51.39 82.62
(7.36) (13.67)
GBP 318.80 3.91
(5.03) (0.07)
SEK 6.18 0.81
(4.89) (0.68)
SGD 5.19 0.13
(2.43) (0.07)
Names of related parties and description of relationship:
a) Promoters Tamilnadu Industrial Development Corporation Ltd.
Tata Sons Ltd.
b) Associate TVS Wind Power Ltd
c) Key Management Personnel Mr. Bhaskar Bhat, Managing Director
Note 34 RELATED PARTY DISCLOSURES
(` lakhs)
(Amount in lakhs)
` Foreign currency
Loans and advancesUSD 2.64 0.05
(0.22) (9.68)
EURO 2.27 0.03
(0.12) (7.39)
SGD 0.05 0.001
(-) (-)
(Amount in lakhs)
(Amount in lakhs)
SL. Nature of transaction Promoters Associate Key TotalNo. Management
Personnel
1. Sale of components and 0.02 – – 0.02 finished goods and fixed assets (–) (–) (0.31) (0.31)
2. Reimbursement of expenses 2.03 – – 2.03 (5.15) (–) (–) (5.15)
3. Interest expense 37.34 – – 37.34 (37.34) (–) (–) (37.34)
4. Rent paid 49.64 – – 49.64 (41.36) (–) (–) (41.36)
5. Purchase of power – 188.14 – 188.14 (–) (–) (–) (–)
6. Dividend paid 4280.51 – – 4280.51 (2568.31) (–) (–) (2568.31)
7. Commission and sitting fees to non whole–time directors 80.64 – – 80.64 (58.99) (–) (–) (58.99)
8. Brand equity subscription 1379.08 – – 1379.08 (1065.30) (–) (–) (1065.30)
9. Payment towards rendering of services 63.31 – – 63.31 (55.33) (–) (–) (55.33)
10. Managerial remuneration – – 320.18 320.18 (–) (–) (301.45) (301.45)
11. Redemption of 6.75% Debentures 553.16 – – 553.16 (–) (–) (–) (–)
12. Subscription to Share capital – – – – (–) (150.00) (–) (150.00)
Transactions with related parties during the year are set out in the table below: (Previous year figures are in brackets)
9796
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012 Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
Note 34 RELATED PARTY DISCLOSURES (Contd.)
(` lakhs)Balance as on balance sheet date Promoters Associate Key Total
ManagementPersonnel
Credit balance
Tata Sons Ltd 948.10 – – 948.10
(624.15) (–) (–) (624.15)
Tamilnadu Industrial Development Corporation Limited 77.18 – – 77.18
(55.66) (–) (–) (55.66)
TVS Wind Power Limited – 3.94 – 3.94
(–) (–) (–) (–)
Mr.Bhaskar Bhat – – 195.82 195.82
(–) (–) (154.97) (154.97)
Total Credit balance 1025.28 3.94 195.82 1225.04
(679.81) (–) (154.97) (834.78)
Balance as on balance sheet date
The following table sets forth the computation of basic and diluted earnings per share:
(` lakhs)Nature fo transaction Category Name Amount(a) Dividend paid Promoter Tamilnadu Industrial Development 3093.46
Corporation Ltd (1856.08)
Promoter Tata Sons Ltd 1187.05
(712.23)
(b) Brand Equity Subscription Promoter Tata Sons Ltd 1379.08
(1065.30)
(c) Redemption of 6.75% Debentures Promoter Tata Sons Limited 553.16
(–)
The above includes the following material related party transactions
2012 2011
Net profit after tax (` lakhs) 60135.59 43312.43
a) Weighted average number of equity shares (No. Lakhs) 8877.86 443.89
b) i) Nominal value of shares (`) 1 10
ii) Earnings per share - Basic and diluted (`) 6.77 4.88
Note 35 EARNINGS PER SHARE
(` lakhs)
Pursuant to the approval of the shareholders through postal ballot, the Board of Directors of the Company at its Meeting held on 14 June 2011
had approved the sub-division of its equity share of the face value of ` 10 each into 10 (ten) equity shares of `1 each and also for the
capitalisation of an amount of ` 4438.93 lakhs from General reserve account of the Company towards issue and allotment as fully paid-up
bonus shares in the ratio of 1 (one) equity share for every existing equity share held by the equity shareholders on the Record date i.e., 24
June 2011.
Note 36 SEGMENT INFORMATION FOR THE YEAR ENDED MARCH 31, 2012
(` lakhs)Watches Jewellery Others Corporate Total
(Unallocated)
RevenueNet sales/income 152835.76 698981.71 32848.42 176.88 884842.77(There is no inter-segment revenue) (127218.49) (501202.30) (24372.08) (520.73) (653313.60)Segment ResultBefore interest, other income and taxes 20821.82 62321.31 (-)481.45 (-)3687.69 78973.99
(18612.37) (44018.28) (-1820.00) (-2715.08) (58095.57)Add : Other Income 971.56 7434.20 32.95 1008.75 9447.46
(679.73) (4278.98) (14.32) (706.68) (5679.71)Share of loss of associate – – – 14.37 14.37
(–) (–) (–) (1.15) (1.15)Profit before interest and taxes 21793.38 69755.51 (–) 448.50 (–)2693.31 88407.08
(19292.10) (48297.26) (–1805.68) (–2009.55) (63774.13)Less : Interest (net) 4373.14
(3454.12)Profit before taxes 84033.94
(60320.01)Taxes 23898.35
(17007.58)Profit after taxes 60135.59
(43312.43)Other InformationSegment Assets 84139.42 329918.98 24144.36 33035.98 471238.74
(71030.81) (261636.01) (18348.20) (24835.02) (375850.04)Segment Liabilities 31905.99 266055.95 7037.29 19366.27 324,365.50
(32481.41) (211168.30) (6991.78) (14667.91) (265309.40)Capital expenditure 5433.66 7535.64 1837.26 511.91 15318.47
(2785.31) (1717.99) (683.26) (1268.56) (6455.12)Depreciation/ amortisation 1839.31 1606.66 862.54 253.08 4561.59
(1631.69) (1048.90) (768.78) (61.80) (3511.17)Non cash expenses other than depreciation/ amortisation 180.62 2820.57 84.33 38.89 3124.41
(10.36) (578.70) (–) (161.96) (751.02)
a) Primary Business Segments (Previous year figures are in brackets)
Total unallocable liabilities exclude2012 2011
Long-term borrowings 588.89 945.11 Foreign currency loan repayable within 12 months 542.22 542.22 6.75% debentures repayable within 12 months – 5,282.60 Deferred tax liability / (asset) (Net) (349.77) 208.80
(` lakhs)
India Others TotalRevenue 868438.89 16403.88 884842.77
(640409.58) (12904.02) (653313.60)
b) Secondary geographical segmentss (Previous year figures are in brackets)
9998
Titan Industries Limited
Notes forming part of the Consolidated Financial Statements for the year ended 31 March 2012
Note 37 THE PARTICULARS OF INVESTMENTS MADE IN THE ASSOCIATE COMPANY ARE AS BELOW
Note 36 SEGMENT INFORMATION FOR THE YEAR ENDED MARCH 31, 2012 (Contd.)
(` lakhs)Name of the associate Original cost of Amount of Goodwill Cumulative share of Carrying cost of
investment (-) Capital Reserve in post acquisition investmentsoriginal cost profits
TVS Wind Power Limited 150.00 – (15.52) 134.48 (150.00) – (–1.15) (148.85)
Previous year figures are in brackets
Note 38
Name of Subsidiary Titan TimeProducts Ltd Titan Properties Ltd Favre Leuba A.G.
(a) Share Capital 190.00 33.50 –*
(b) Reserves 586.18 623.71 (30.35)
(c) Total Assets 1356.44 751.85 1043.87
(d) Total Liabilities 580.26 94.64 –
(e) Income 2590.55 212.40 –
(f ) Profit before tax 145.92 94.08 (30.35)
(g) Taxes 42.99 29.07 –
(h) Profit after tax 102.93 65.01 (30.35)
(i) Proposed Dividend – – –
* Share application money pending allotment ` 1074.22 lakhs
Statement pursuant to exemption granted under Section 212(8) of the companies Act, 1956 relating to Subsidiary companies as
at 31 March 2012.
a) The figures pertaining to subsidiary companies have been reclassified , where necessary, to bring them in line with the parent company'sfinancial statements.
b) The figures of the previous year have been regrouped/recast, where necessary, to conform to the current year classification.
Note 39
The operating facilities of the Company are commonly employed for both the domestic and export business, hence it is not possible toreport segment assets and capital expenditure by geographical segments.
Details of secondary geographical segments for individual markets outside India are not disclosed as the same do not account for more than10% of the total segment revenues or results or assets.
(` lakhs)
For and on behalf of the Board of Directors
Bhaskar Bhat N. Sundaradevan ChairmanManaging Director Ishaat Hussain
T K BalajiS.Subramaniam K Dhanavel
Chief Financial Officer C.G.Krishnadas NairVinita Bali DirectorsV ParthasarathyR Poornalingam
A.R.Rajaram Hema RavichandarChennai, 30 April 2012 Head-Legal & Company Secretary Das Narayandas
Quick Information� Number of equity shareholders – 1,24,481� Number of equity shares held – 88,77,86,160� Stock exchanges in which the equity shares are listed:
Bombay Stock Exchange Limited (BSE).National Stock Exchange of India Limited (NSE).
� 96.76% of the Company’s equity capital is held in dematerializedform with NSDL and CSDL.
� TSR Darashaw Limited is the Registrar and Transfer Agents (R &TA) of the Company.
� Non Promoter/Public Shareholding as on 31st March 2012 –416,778,240 amounting to 46.95%.
Investor Grievances handling MechanismInvestor service matters are being handled by TSR Darashaw Limited.They have branches across the country and discharge investorservice functions efficiently, effectively and expeditiously. TheCompany has an established mechanism for investor service andgrievance handling, with TSR Darashaw Limited.
Suggestions to shareholdersOpen Demat Account and dematerialize your sharesIn the best interest of the investors it is suggested to convert theirphysical holdings of securities into demat holdings. By holdingsecurities in demat form helps investors to get immediate transfer ofsecurities. Stamp duty would not be payable on transfer of sharesheld in demat form. Risks associated with physical certificates suchas forged transfers, fake certificates and bad deliveries can beavoided.
Dematerialization of sharesTrading in the shares of the Company is compulsory indematerialized form for all investors. The Company has, therefore,enlisted its shares with both the depositories, viz, NSDL and CDSL.This means that one has the option to hold and trade in the sharesof the Company in electronic form.
What Is Dematerialisation of shares?Dematerialisation is a process by which the physical sharecertificates of an investor are taken back by the Company and anequivalent number of securities are credited in electronic form atthe request of the investor. An investor will have to first open anaccount with a Depository Participant and then request for thedematerialisation of his share certificates through the DepositoryParticipant so that the dematerialised holdings can be credited intothat account. This is very similar to opening a Bank Account.
What is a Depository?A depository is an organisation which holds securities (like shares,debentures, bonds, government securities, mutual fund units etc.) ofinvestors in electronic form at the request of the investors througha registered Depository Participant. It also provides services relatedto transactions in securities.
How many Depositories are registered with SEBI? At present two Depositories viz. National Securities DepositoryLimited (NSDL) and Central Depository Services (India) Limited(CDSL) are registered with SEBI.
Is a depository similar to a bank?It can be compared with a bank, which holds the funds fordepositors. A Bank – Depository analogy is given in the followingtable:
Who is a Depository Participant?A Depository Participant (DP) is an agent of the depository throughwhich it interfaces with the investor and provides depositoryservices. Public financial institutions, scheduled commercial banks,foreign banks operating in India with the approval of the ReserveBank of India, state financial corporations, custodians, stock-brokers,clearing corporations /clearing houses, NBFCs and Registrar to anIssue or Share Transfer Agent complying with the requirementsprescribed by SEBI can be registered as DP. Banking services can beavailed through a branch whereas depository services can beavailed through a DP.
Is it compulsory for every investor to open a beneficial owner (BO)account to trade in the capital market?
In view of the convenience of trading in dematerialised mode, it isadvisable to have a beneficial owner (BO) account for trading at theexchanges.
Shareholders’ Information
Bank Depository
Holds funds in an account Holds securities in an account
Transfers funds between Transfers securities between
accounts on the instruction of accounts on the instruction of
the account holder the BO account holder
Facilitates transfer without having Facilitates transfer of
to handle money ownership without having to
handle securities
Facilitates safekeeping of money Facilitates safekeeping of
securities
101100
Titan Industries Limited
Benefits of Demat� Reduces risks involved in holding physical certificated, e.g., loss,
theft, mutilation, forgery, etc.� Ensures transfer settlements and reduces delay in registration of
shares.� Ensures faster communication to investors.� No stamp duty is paid on transfer of shares.� Provides more acceptability and liquidity of securities.� Faster settlement cycles and payouts.� Postal delays and loss of shares in transit is prevented.� Periodic status reports and information available on internet.� Easy portfolio monitoring.
What is the procedure to dematerialize the shares?� Open an account with a Depository Participant (DP) of your
choice by filling up an Account Opening Form.� Fill up and submit a Dematerialization Request Form (DRF)
provided by the DP duly signed by all the holders and surrenderthe physical shares intended to be dematted to the DP. The DPupon receipt of the shares will issue you an acknowledgementand will send an electronic request to the Company/ Registrarsand Transfer Agents of the Company through the Depository forconfirmation of demat.
� The DP will simultaneously surrender the DRF and the shares tothe Company / Registrars and Transfer Agents of the Companywith a covering letter requesting the Company to confirm demat.
� The Registrars and Transfer Agents of the Company, afternecessary verification of the documents received from the DP,will cancel the physical shares and confirm demat to theDepository.
� This confirmation will be passed on by the Depository to the DPwhich holds your account. After receiving this confirmation fromthe Depository, the DP will credit your account with the numberof shares dematerialized.
� The DP will hold the shares in the dematerialized form thereafteron your behalf. And you will become the beneficial owner ofthese dematerialized shares.
Can odd lots be dematerialized?Yes, odd lot share certificates can also be dematerialized.
Why should an investor give his bank account details at thetime of BO account opening?Bank account details are necessary for the protection of interest ofinvestors. When any cash or non cash corporate benefits such asrights or bonus or dividend is announced for a particular scrip,depositories provide to the concerned issuer /it’s RTA, the details ofthe investors, their electronic holdings as on record / book closuredate for reckoning the entitlement of corporate benefit.
The disbursement of cash benefits such as dividend is credited
directly by the Issuer/it’s RTA to the beneficiary owner through theECS (Electronic Clearing Service wherever available) facility or byissuing warrants on which bank account details are printed forplaces where ECS facility is not available. The bank account numberis mentioned on the dividend and warrant to avoid any fraudulentmisuse. The bank account details will be those which are mentionedin account opening form or modified details that had beenintimated subsequently by the investor to the DP.
Can multiple accounts be opened?Yes. An investor can open more than one account in the same
name with the same DP and also with different DPs. For all theaccounts, investor has to strictly comply with KYC norms includingProof of Identity, Proof of Address requirements as stipulated by SEBIand also provide PAN number. The investor has to show the originalPAN card at the time of opening of demat account.
Does the investor have to keep any minimum balance ofsecurities in his account?No.Can investor close his demat account with one DP andtransfer all securities to another account with another DP?Yes. The investor can submit account closure request to his DP inthe prescribed form. The DP will transfer all the securities lying in theaccount, as per the instruction, and close the demat account.
Do dematerialised shares have distinctive numbers?Dematerialised shares do not have any distinctive numbers. Theseshares are fungible, which means that all the holdings of a particularsecurity will be identical and interchangeable
Can electronic holdings be converted back into physicalcertificates?Yes. The process is called rematerialisation. If one wishes to get backhis securities in the physical form he has to fill in the RRF (RematRequest Form) and request his DP for rematerialisation of thebalances in his securities account.
What is the procedure to rematerialise the shares?� Shareholders should submit duly filled in rematerialisation
request form (RPF) to the concerned DP.� DP intimates the relevant Depository of the request through the
system.� DP submits RRF to the company’s R&TA.� Depository confirms rematerialisation request to the company’s
R&TA.� The company’s R&TA updates accounts and prints certificate(s)
and informs the depository.� Depository updates the beneficiary account of the shareholder
by deleting the shares so rematerialized. Share certificate(s) isdispatched to the shareholder.
What is ISIN?ISIN (International Securities Identification Number) is a unique 12digit alpha-numeric identification number allotted for a security(e.g.- Titan’s ISIN No. INE280A01028). Equity-fully paid up, equity-partly paid up, equity with differential voting /dividend rightsissued by the same issuer will have different ISINs.
How does one know that the DP has updated the accountafter each transaction?The DP provides a Transaction Statement periodically, which givesdetails of current balances and various transactions made throughthe depository account. If desired, DP may provide the TransactionStatement at intervals shorter than the stipulated ones, probably ata cost.
At what frequency will the investor receive his TransactionStatement from his DP?DPs have to provide transaction statements to their clients once ina month, if there is any transaction and if there is no transaction,then once in a quarter.
DPs also provide transaction statement in electronic form underdigital signature subject to their entering into a legally enforceablearrangement with the BOs to this effect.
Nomination FacilityWhat is Nomination Facility?Section 109A of the Companies Act, 1956 provides the facility ofnomination to shareholders. This facility is useful for individualsholding shares in sole name. In the case of joint holding of shares byindividuals, nomination will be effective only in the event of thedeath of all joint holders.
How to appoint a nominee?Investors, who are holding shares in single name, are advised to availof the nomination facility with the R&TA. However if the shares areheld in demat form, nomination facility has to be registered with theconcerned DP directly, as per the format prescribed by the DP.
Who can appoint nominee?Individuals holding shares in single name or joint names can appointnominees. In case of joint shareholding, joint holders together haveto appoint the nominee. Non-individuals including society, trust,body corporate, karta of Hindu Undivided Family, holder of power ofattorney cannot nominate.
Who can be appointed as a nominee & who cannot beappointed as a nominee?Individual can be appointed as a nominee. Minor can be appointedas a nominee.
A Trust, Society, body corporate, partnership firm Karta of a HUF ora power of attorney holder cannot be nominees.
Can joint shareholders deem to be nominee(s) to theshares?Joint shareholders are not deemed to be the nominee(s).Howeverjoint shareholders may, together appoint a nominee. In the eventof death of any one of the joint holders, surviving joint holder/s ofshares is/are the only person(s) recognized under the law asholder(s) of the shares.
Rights of the nomineeThe nominee is entitled to all the rights of the deceased shareholderto the exclusion of all other persons. In the event of death of ashareholder, all the rights of the shareholder shall vest with thenominee. In case of joint shareholding, all t he rights shall vest withthe nominee only in the event of death of all the joint shareholders.
Consolidate multiple portfolios It is suggested that all the investors to consolidate their shareholdingheld in multiple portfolios. It would facilitate reduction of time andefforts to monitor multiple portfolios. It also avoids multiple trackingof corporate benefits.
DividendsPayment of dividend: The dividend is paid in two modes. They are: (1) National Electronic Clearing Service (NECS).(2 Physical dispatch of Dividend Warrant
What is National Electronic Clearing Service Facility?NECS facility is centralized version of ECS facility. National ElectronicClearing Service (NECS) was introduced during September 2008 forcentralized processing of repetitive and bulk payment instructions.The service aims to centralize the Electronic Clearing Service (ECS)operation and bring in uniformity and efficiency to the system. Thesystem takes advantage of the centralized accounting system inbanks. NECS (Credit) would facilitate multiple credits to beneficiaryaccounts destination branch at participating centre against a singledebit of the account of a user with the sponsor bank. NECS (Debit)would facilitate multiple debits to destination account holdersagainst single credit to user account. The branches participating inNECS can be located anywhere in the country.
As per directive from Securities and Exchange Board of India (SEBI),the Company has been using the Electronic Clearing Service of theReserve Bank of India (RBI) at designated locations, for payment ofdividend to shareholders holding shares in dematerialised form. Theservice was extended by the Company also to shareholders holdingshares in physical form, who chose to avail of the same. In this
103102
Titan Industries Limited
system, the investor’s bank account is directly credited with thedividend amount.
As per RBI’s notification, with effect from 1st October 2009, theremittance of money through ECS has been replaced by NationalElectronic Clearing Service (NECS). NECS operates on the new andunique bank account number allotted by banks postimplementation of the Core Banking Solutions (CBS). Pursuant toimplementation of CBS, your bank account number may haveundergone a change, which is required to be communicated by youto your Depository Participant (in case of shareholders holdingshares in dematerialised form) or to the Company’s Share TransferAgent (in case of shareholders holding shares in physical form, inwhich case the communication may be made in the Mandate Formwhich had been mailed to the shareholders.
Shareholders holding shares in physical form who have not yetopted for the ECS Mandate Facility, are urged to avail of the NECSMandate Facility as this not only protects a shareholder againstfraudulent interception and encashment of dividend warrants butalso eliminated dependence on the postal system, loss / damage ofdividend warrants in transit and correspondence relating torevalidation / issue of duplicate dividend warrants.
Kindly ensure that the above instructions are under your signature(which should be as per specimen registered with the DepositoryParticipant / Company) and are communicated beforecommencement of the book closure date, to facilitate receipt ofdividend. Please note that if your new bank account number is notinformed as aforesaid, payment of your dividend to your old bankaccount number may either be rejected or returned. Shareholdersare requested to refer to the NECS Mandate Form mailed to them bythe Company.
Benefits of NECS Facility� The shareholder need not visit his bank for depositing the paper
instruments which he would have otherwise received had henot opted for ECS Credit.
� The shareholder need not be apprehensive of loss/theft ofphysical instruments or the likelihood of fraudulent encashmentthereof.
� Cost effective.
� Prompt credit to bank account of the shareholder throughelectronic clearing.
How to avail NECS Facility?Investors holding shares in physical form can send the NECSMandate form, duly filled in, to the Company’s R&TA. However, ifshares are held in dematerialized form, NECS mandate form has tobe sent to the concerned Depository Participant (DP) directly, in theformat prescribed by the DP. It is to be noted that NECS essentiallyoperates on the new and unique bank account number, allotted bybanks post implementation of Core Banking Solutions (CBS) forcentralized processing of inward instructions and efficiency inhandling bulk transactions. Shareholders are requested to providethe new Bank Account Number allotted by the banks postimplementation of CBS, along with a copy of cheque relating to theconcerned account, to the R& TA of the Company in case you holdshares in physical form and to the concerned depository participantin case you hold shares in demat form.
Unpaid DividendMembers may please note that pursuant to Section 205C of theCompanies (Amendment) Act, 1999, the dividend remaining unpaidor unclaimed for a period of seven years from the date of transfer toUnpaid Dividend Account of the Company will be transferred to theInvestor Education and Protection Fund set up by the Governmentof India and no payments shall be made in respect of any suchclaims. Periodic intimation in this regard is sent to the concernedshareholders. Given below are the dates of declaration of dividendand corresponding dates when unpaid/unclaimed dividends aredue for transfer to the Investor Education and Protection Fund:-
Financial year ended Date of declaration of Dividend Last date for claiming unpaid dividend
31.03.2004 August 31, 2004 August 30, 2011
31.03.2005 August 31, 2005 August 30, 2012
31.03.2006 August 21, 2006 August 20, 2013
31.03.2007 July 27, 2007 July 26, 2014
31.03.2008 July 31, 2008 July 30, 2015
31.03.2009 July 27, 2009 July 26, 2016
31.03.2010 July 27, 2010 July 26, 2017
31.03.2011 July 28, 2011 July 27, 2018
Fina
ncia
l Sta
tistic
s - B
alan
ce S
heet
BALA
NCE S
HEET
1987
-88
88-8
989
-90
90-9
191
-92
92-9
393
-94
94-9
595
-96
96-9
797
-98
98-9
919
99-2
000
2000
-01
2001
-02
2002
-03
2003
-04
2004
-05
2005
-06
2006
-07
2007
-08
2008
-09
2009
-10
Shar
e Ca
pita
l - E
quity
23.9
5 23
.96
26.8
4 26
.84
26.8
4 42
.28
42.2
8 42
.28
42.2
8 42
.28
42.2
8 42
.28
42.2
8 42
.28
42.2
8 42
.28
42.2
8 42
.28
42.2
8 44
.39
44.3
9 44
.39
44.3
9
Shar
e Ca
pita
l - P
refe
renc
e-
-
-
-
-
-
-
7.
50
10.0
0 33
.00
37.5
0 40
.00
40.0
0 40
.00
40.0
0 40
.00
40.0
0 40
.00
40.0
0 -
-
-
-
Rese
rves
and
Sur
plus
0.21
1.
38
2.11
6.
42
12.1
5 77
.82
86.3
4 98
.74
111.
46
117.
25
115.
73
116.
07
118.
56
125.
09
82.4
2 80
.19
82.8
5 94
.97
150.
30
283.
06
391.
78
506.
85
679.
99
Def
erre
d ta
x lia
bilit
y-
-
-
-
-
-
-
-
-
-
-
-
-
-
44
.58
41.5
9 35
.14
29.3
2 23
.75
17.4
4 24
.71
18.1
8 4.
75
Loan
s37
.76
42.4
5 57
.86
66.5
2 75
.46
114.
43
151.
15
191.
63
303.
34
368.
14
381.
80
395.
48
409.
92
422.
01
443.
28
467.
05
406.
71
318.
02
267.
92
247.
01
257.
89
175.
41
72.7
9
SOUR
CES
OF
FUND
S - T
otal
61.9
2 67
.79
86.8
1 99
.78
114.
45
234.
53
279.
77
340.
15
467.
08
560.
67
577.
31
593.
83
610.
76
629.
38
652.
56
671.
11
606.
98
524.
59
524.
25
591.
89
718.
77
744.
83
801.
93
Net
fixe
d as
sets
53.7
6 60
.34
79.6
6 86
.09
95.2
0 13
1.37
16
6.65
20
5.91
22
9.67
23
2.86
23
8.38
23
6.63
22
3.80
21
1.16
20
0.90
19
1.75
17
7.36
17
4.91
19
6.02
26
7.12
28
2.45
29
4.00
27
4.92
Inve
stm
ents
0.03
0.
06
0.06
0.
06
0.06
0.
06
14.9
2 21
.82
28.3
2 27
.00
27.0
0 27
.00
25.1
2 23
.09
24.6
2 37
.09
27.5
8 27
.02
27.0
2 27
.02
47.3
9 7.
66
7.63
Def
ered
tax
asse
t
Inve
ntor
ies
8.17
14
.94
29.9
3 62
.65
71.6
3 86
.39
101.
85
112.
07
152.
54
226.
19
172.
67
172.
19
183.
44
146.
23
124.
82
141.
92
164.
12
271.
62
374.
39
677.
48
1,02
1.09
1,
202.
69
1,34
0.33
Deb
tors
0.24
2.
41
3.27
4.
03
5.65
14
.06
14.3
2 33
.58
77.8
5 78
.10
83.2
5 10
1.40
12
1.05
15
9.04
20
7.75
18
6.38
14
8.16
77
.09
90.1
2 92
.06
96.4
5 10
6.22
93
.61
Cash
and
ban
k ba
lanc
es3.
34
2.38
0.
96
2.22
1.
70
8.50
12
.65
9.63
13
.85
4.58
7.
64
5.04
17
.53
27.5
1 17
.33
23.9
9 26
.85
44.0
1 38
.29
50.7
3 51
.91
54.6
9 18
6.72
Loan
s and
Adv
ance
s5.
16
2.41
4.
51
10.3
8 15
.95
30.1
9 18
.61
18.9
3 43
.89
68.4
2 10
6.47
12
1.45
11
5.48
15
0.67
19
7.40
21
7.08
19
3.69
17
2.14
14
3.96
65
.54
99.1
7 11
4.13
18
3.06
Tota
l Cur
rent
Ass
ets
16.9
1 22
.14
38.6
7 79
.28
94.9
3 13
9.14
14
7.43
17
4.21
28
8.13
37
7.29
37
0.03
40
0.08
43
7.50
48
3.45
54
7.30
56
9.37
53
2.82
56
4.86
64
6.76
88
5.81
1,
268.
62
1,47
7.73
1,
803.
71
Less
: Cur
rent
Lia
bilit
es &
Pro
visio
ns8.
78
14.7
5 31
.58
65.6
5 75
.74
36.0
4 49
.23
61.7
9 79
.04
76.4
8 58
.10
69.8
8 79
.93
91.5
2 12
6.45
17
3.27
16
4.09
26
6.60
35
9.86
59
2.26
87
9.70
1,
034.
57
1,28
4.33
Net
Cur
rent
Ass
ets
8.13
7.
39
7.09
13
.63
19.1
9 10
3.10
98
.20
112.
42
209.
09
300.
81
311.
93
330.
20
357.
57
391.
93
420.
86
396.
10
368.
73
298.
26
286.
91
293.
55
388.
93
443.
16
519.
38
Def
erre
d re
venu
e ex
pend
iture
-
-
-
-
-
-
-
-
-
-
-
-
4.27
3.
20
6.18
46
.17
33.3
1 24
.40
14.3
1 4.
21
-
-
-
APPL
ICAT
ION
OF
FUND
S - T
otal
61.9
2 67
.79
86.8
1 99
.78
114.
45
234.
53
279.
77
340.
15
467.
08
560.
67
577.
31
593.
83
610.
76
629.
38
652.
56
671.
11
606.
98
524.
59
524.
25
591.
89
718.
77
744.
83
801.
93
(`Cr
ores
)
BALA
NCE
SHEE
T20
10-1
120
11-1
2
Shar
e Ca
pita
l - E
quity
44.3
9 88
.78
Rese
rves
and
Sur
plus
980.
99
1,36
1.12
Def
erre
d ta
x lia
bilit
y1.
52
-
Non
-cur
rent
liab
ilitie
s53
.50
74.8
8
Curre
nt li
abili
ties
2,65
5.16
3,
174.
75
EQUI
TY A
ND L
IABI
LITI
ES3,
735.
56
4,69
9.53
Non
-cur
rent
ass
ets
Net
fixe
d as
sets
299.
71
393.
58
Inve
stm
ents
9.13
16
.05
Def
ered
tax
asse
t3.
77
Long
term
loan
s & a
dvan
ces
121.
53
127.
94
Curre
nt a
sset
s
Inve
ntor
ies
1,99
3.83
2,
878.
67
Deb
tors
113.
68
163.
11
Cash
and
ban
k ba
lanc
es1,
096.
50
960.
53
Shor
t-ter
m lo
ans a
nd a
dvan
ces
85.5
9 12
3.25
Oth
er c
urre
nt a
sset
s15
.59
32.6
3
ASSE
TS3,
735.
56
4,69
9.53
(`Cr
ores
)
104
Titan Industries LimitedFi
nanc
ial S
tatis
tics -
Pro
fit &
Los
s Acc
ount
PRO
FIT
& LO
SS A
CCO
UNT
1987
-88
88-8
989
-90
90-9
191
-92
92-9
393
-94
94-9
595
-96
96-9
797
-98
98-9
9199
9-20
0020
00-0
120
01-0
220
02-0
320
03-0
420
04-0
520
05-0
620
06-0
720
07-0
820
08-0
920
09-1
0
Sale
s vol
umes
(nos
in la
khs)
Wat
ches
3.44
5.
13
12.5
2 18
.33
22.4
2 25
.75
28.0
7 32
.58
38.7
5 39
.45
43.5
3 51
.11
58.5
4 66
.76
61.7
7 60
.02
68.3
8 73
.19
83.3
6 89
.64
102.
86
96.9
3 11
0.36
Jew
elle
ry-
-
-
-
-
-
-
0.
09
0.20
0.
37
1.20
1.
68
3.00
7.
21
6.05
13
.72
8.70
4.
32
5.70
7.
20
11.3
9 13
.65
14.2
2
Cloc
ks, s
ungl
asse
s, et
c.-
-
-
-
-
-
-
-
0.
67
3.64
3.
05
4.30
3.
29
1.62
0.
51
0.41
2.
39
4.84
5.
05
5.29
6.
97
9.29
15
.20
Sale
s Inc
ome
16.8
0 27
.59
74.0
6 10
6.26
15
5.01
19
1.21
22
6.23
28
2.49
35
0.72
40
8.52
44
2.06
48
2.04
63
0.33
69
6.90
72
4.78
79
7.90
95
8.52
1,
134.
66
1,48
1.37
2,
136.
46
3,04
1.09
3,
847.
72
4,70
3.12
Expe
nditu
re16
.40
21.0
9 59
.02
79.2
9 11
9.94
15
6.25
18
3.78
22
3.93
27
6.19
32
0.73
35
7.20
39
3.48
55
0.62
61
4.19
63
9.32
72
6.03
86
2.49
1,
019.
50
1,32
7.42
1,
938.
01
2,79
0.70
3,
551.
23
4,30
8.17
Inte
rest
1.36
3.
51
6.51
11
.82
17.7
2 18
.46
16.1
6 21
.80
34.2
2 56
.40
52.9
6 51
.92
50.8
8 47
.84
46.2
7 41
.35
37.6
2 30
.92
24.8
4 20
.42
20.1
4 29
.43
25.4
2
Dep
reci
atio
n/Am
ortis
atio
n0.
85
2.16
3.
98
6.57
6.
74
7.23
9.
78
13.1
1 15
.68
16.5
2 18
.82
20.1
4 20
.40
20.9
3 23
.28
21.1
4 21
.47
19.6
1 19
.66
25.5
9 29
.73
41.7
6 60
.08
Ope
ratin
g Pr
ofit
(1.8
1)0.
83
4.55
8.
58
10.6
1 9.
27
16.5
1 23
.65
24.6
3 14
.87
13.0
8 16
.50
8.43
13
.94
15.9
1 9.
38
36.9
4 64
.63
109.
45
152.
44
200.
53
225.
30
309.
46
Add:
Oth
er In
com
e2.
11
0.45
0.
56
0.52
0.
49
1.60
2.
58
1.44
2.
94
12.9
3 3.
16
2.41
13
.01
11.6
3 2.
24
10.4
0 2.
09
2.73
2.
43
3.22
1.
77
5.26
11
.86
Less
: Exc
eptio
nal I
tem
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(10.
00)
(25.
00)
(35.
00)
(25.
00)
(24.
00)
-
-
-
Prof
it Be
fore
Taxe
s0.
30
1.28
5.
11
9.10
11
.10
10.8
7 19
.09
25.0
9 27
.57
27.8
0 16
.24
18.9
1 21
.44
25.5
7 18
.16
9.78
14
.03
32.3
6 86
.88
131.
65
202.
30
230.
56
321.
32
Taxe
s0.
04
0.21
0.
78
-
-
-
-
-
-
3.58
1.
60
1.87
2.
16
2.09
5.
06
3.57
2.
84
7.41
13
.26
37.5
2 52
.04
71.5
9 70
.99
Prof
it Af
ter T
axes
0.26
1.
07
4.33
9.
10
11.1
0 10
.87
19.0
9 25
.09
27.5
7 24
.22
14.6
4 17
.04
19.2
8 23
.48
13.0
9 6.
21
11.1
9 24
.95
73.6
2 94
.13
150.
27
158.
96
250.
32
Equi
ty D
ivid
end
(%)
-
-
15%
18%
20%
22%
25%
30%
33%
33%
25%
26%
26%
26%
15%
10%
10%
20%
30%
50%
80%
100%
150%
Equi
ty D
ivid
end
(Rs.)
-
-
3.60
4.
83
5.37
6.
89
10.5
7 12
.69
13.9
5 13
.95
10.5
7 10
.99
10.9
9 10
.99
6.34
4.
23
4.23
8.
46
13.3
2 22
.19
35.5
1 44
.39
66.5
8
Empl
oyee
cos
ts (e
xclu
ding
VRS
)1.
03
1.56
3.
98
6.24
8.
19
12.8
4 17
.89
22.6
2 32
.20
48.1
3 48
.91
54.0
4 72
.17
74.0
7 76
.32
71.5
7 84
.98
95.7
3 10
9.13
15
7.04
18
9.16
23
3.40
27
4.49
% to
Sal
es In
com
e6.
1%5.
7%5.
4%5.
9%5.
3%6.
7%7.
9%8.
0%9.
2%11
.8%
11.1
%11
.2%
11.4
%10
.6%
10.5
%9.
0%8.
9%8.
4%7.
4%7.
4%6.
2%6.
1%5.
8%
Adve
rtisi
ng1.
85
2.07
5.
61
8.38
9.
52
13.1
6 16
.06
20.2
2 29
.62
36.0
1 20
.04
27.3
6 41
.69
40.1
0 36
.55
47.4
4 59
.82
76.8
9 10
1.31
13
3.82
15
1.55
18
1.36
21
1.15
% to
Sal
es In
com
e11
.0%
7.5%
7.6%
7.9%
6.1%
6.9%
7.1%
7.2%
8.4%
8.8%
4.5%
5.7%
6.6%
5.8%
5.0%
5.9%
6.2%
6.8%
6.8%
6.3%
5.0%
4.7%
4.5%
(`Cr
ores
)
Fina
ncia
l Sta
tistic
s - S
tate
men
t of P
rofit
& L
oss
STAT
EMEN
T O
F PR
OFI
T &
LOSS
2010
-11
2011
-12
Sale
s vol
umes
(nos
in la
khs)
Wat
ches
135.
98
156.
94
Jew
elle
ry15
.52
17.0
9 Cl
ocks
, sun
glas
ses,
etc.
26.8
9 33
.12
Reve
nue
from
ope
ratio
ns6,
570.
86
8,97
0.86
Ex
pend
iture
5,95
8.94
8,
137.
92
Inte
rest
34.5
2 43
.72
Dep
reci
atio
n/Am
ortis
atio
n34
.48
44.9
0 O
pera
ting
Prof
it54
2.93
74
4.32
Ad
d: O
ther
Inco
me
56.0
8 94
.11
Less
: Exc
eptio
nal I
tem
-
-
Prof
it Be
fore
Taxe
s59
9.00
83
8.44
Ta
xes
168.
58
238.
28
Prof
it Af
ter T
axes
430.
42
600.
16
Equi
ty D
ivid
end
(%)
250%
175%
Equi
ty D
ivid
end
(Rs.)
110.
97
155.
36
Empl
oyee
cos
ts (e
xclu
ding
VRS
)36
5.13
39
2.34
%
to S
ales
Inco
me
5.6%
4.4%
Adve
rtisi
ng30
3.27
38
1.42
%
to S
ales
Inco
me
4.6%
4.3%
(`Cr
ores
)
Notes
Titan Industries Limited
Notes
“Titan – the changing face of time”The six words that define Titan’s journey over thepast 25 years and extension beyond time
TWENTY-EIGHTHANNUAL REPORT 2011-123, SIPCOT Industrial Complex,
Hosur 635 126
The Goldplus Nano car adorned with 5000 years of Indian jewellery-making tradition,travelled across 30 cities promoting Goldplus, the mass market jewellery brand